Virginia Code 6.2-320: Loans by industrial loan associations.
A. Notwithstanding any statutory or case law relating to interest or usury, loans made by an industrial loan association payable in weekly, monthly, or other periodic installments may be enforced as agreed in the contract of indebtedness. In addition, such association may charge or collect in advance from the borrower on such loans a loan fee not exceeding two percent of the principal amount of the loan. An interest rate charged in advance upon the entire amount of the loan or pursuant to a written modification agreement shall be lawful.
Terms Used In Virginia Code 6.2-320
- Case law: The law as laid down in cases that have been decided in the decisions of the courts.
- Contract: A legal written agreement that becomes binding when signed.
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- Loan: means a loan or forbearance of money. See Virginia Code 6.2-300
- Usury: Charging an illegally high interest rate on a loan. Source: OCC
B. An industrial loan association may charge interest at an annual rate not exceeding 18 percent on loans payable on demand or in a single payment. In addition, such association may charge or collect in advance from the borrower on such loans a loan fee not exceeding two percent of the principal amount of the loan.
1987, c. 622, § 6.1-330.68; 2010, c. 794.