English Ar t .1175.Us ur i oust r ans ac t i onsshal lbego ver nedb ys pec i all aws .( n)Ar t .1176.Ther ec ei ptof t hepr i nc i pal byt hec r e di t orwi t houtr eser v at i onwi t hr espec tt ot hei nt er es t ,s hal lgi v er i set ot he pr es umpt i ont hats ai di nt er es thasbeenpai d.Ther ec ei ptofal at eri ns t al l mentofadebtwi t hout r es er v at i onast opr i ori ns t al l ment s ,s hal l l i k ewi s er ai s et hepr es umpt i ont hats uc hi ns t al l ment s ha v ebeenpai d.( 1110a )Ar t .1177 .Th ec r edi t or s ,af t erha vi ngpur s uedt hepr ope r t yi npos s es s i on oft hedebt ort os at i s f yt hei rc l ai ms,mayex er c i seal lt her i ght sandbr i ngal lt heact i onsoft he l at t erf ort hesa mep me ur pos e,s av et hos ewhi c har ei nher enti nhi sper s on;t he yma ya l s oi mpugn t heac t swh i c ht hedebt orma yha v edonet odef r audt hem.( 1111 )Ar t .117 8.Subj ec tt ot hel a ws , al lr i ght sacqui r edi nv i r t ueofanobl i gat i onar et r ansmi s si bl e,i ft her ehasbeennos t i pul at i ont o t hecont r ar y .( 1112)
Filipino 1. Ar t .1175.Usur i ousmg mgat r ansaksyonaypama mama mahal aanngmgabat assaespesyal na. ( N)Ar t .1176.Angpagt anggapngpunonggur osapamama magi t anngang p i n ag ka ka ut a ng annawa l a ngr e se r v a t i o nn ama ypa gs a sa al a ng a l a ngs ai n t e r e s,da pa t ma gb i g a yn gp ag t a ass apa gp ap al a ga ynas i n ab ii n t e r e sayb i n ab ay a r a n.An gp ag t a ng ga p n gi b an gg r u pon gp an i n dangi s a ngu t a ngnawa l a ngr e s er v a t i o nb i l a ngs ana un an g i ns t a l l me nt ,a yda patd i nt a as ana ngpa gp apa l a ga ynaa ngmg mg ag an i t o ngi n s t a l l men tna b i n ay a r a n.( 1 11 0a)Ar t .1 17 7.An gc r e di t o r s ,pa gk at a po sngpa gk ak ar o onngpur s ue da ng ar i ar i ansapagkakar oonngmgadebt orupangma masi yahanangkani l angmgacl ai m,mage he r s i s y oa ngl a ha tn gk ar a pa t a na td al h i nangl a ha tn gmg aa k sy o nn gh ul i p ar as a p ar e ho ngl a y un i n ,i s a v ea ngmg mg an al i k asn at a gl a yngka ny a ngmg mg at a o;ma aa r in i l a ng r i ngi mpugnsamg mgagawai nnakungsaanangdebt orayma maaar i ngt aposnasadef r aud mg ai t o .( 1 11 1)Ar t .1 17 8.Nap ap ai l a l i ms aba t a s,a ngl a hatn gmg ak ar a pa t a nn ak u hasa k ab ut i h anngi s an go bl i g as y o na yna ka k ah awa ,k u ngna gk ar o onwa l a ngs t i p ul a t i o nn a k as al ungat .( 1 112)
Usury is a civil or criminal violation involving charging more than the maximum interest rate allowed by law. The rate of interest legally allowed is governed by state statutes. If a court finds that the rate of interest on a loan is usurious, the interest due becomes void and only the principal of the loan needs to be repaid. To constitute constitute usury there must be an knowing and consensual obligation of the borrower to return the principal as well as pay an amount greater than lawful interest. The lawful rate of interest will be governed by the country in which the contract was made. Usury is usually only considered a crime if a person is a "loan-shark" someone in the business of loaning money at usurious rates!. anks and other commercial lenders generally are not sub#ect to anti-usury laws, but are governed by the marketplace and the competitive rates based upon the $ederal %eserve&s %eserve&s rates for bank loans. 'tate laws vary, and often contain exceptions for various types of transactions, so local laws should be consulted for applicable re(uirements. re(uirements. The following is an example of a )irginia usury law* "+ontracts for more than legal rate of interest.
xcept as otherwise permitted by law, no contract shall be made for the payment of interest on a loan greater than twelve percent per year. $or statutes which permit payment of interest greater than twelve percent per year, reference is hereby made to rticle / .0-112.2 et se(.!, rticle 3 / .0-112.4!, rticle 5 / .0-112.6 et se(.!, rticle 7 / .0-112.7 et se(.!, rticle 02 / .0-112.36 et se(.! and rticle 00 / .0-112.33 et se(.! of this chapter. $urther reference is hereby made to +hapter / .0-844 et se(.! of this title, relating to powers of consumer finance companies9 to +hapter 05 / .0-444 et se(.! of this title, relating to payday lenders9 to / 15.8-052, relating to interest chargeable by insurance agents9 to // 15.8-4322 through 15.8-4308, relating to interest chargeable by premium finance companies9 and to / 65.0-1205, relating to interest and origination fees payable under third-party taxpayer agreements. In the case of any loan upon which a person is not permitted to plead usury, interest and other charges may be imposed and collected as agreed by the parties. Those provisions of this chapter providing that a loan or extension of credit may be enforced as agreed in the contract of indebtedness, shall not be construed to preclude the charging or collecting of other loan fees and charges permitted by law, in addition to the stated interest rate, and such other loan fees and charges need not be included in the rate of interest stated in the contract of indebtedness. "
USURY The civil or criminal wrong of charging interest that is beyond the legal limit set by a 'tate. The illegal profit which is re(uired and received by the lender of a sum of money from the borrower for its use. In a more extended and improper sense, it is the receipt of any profit whatever for the use of money* it is only in the first of these senses that usury will be here considered. To constitute a usurious contract the following are the requisites: 1. A loan express or implied. 2. An agreement that the money lent shall be returned at all events. 3. ot only that the money lent shall be returned! but that for such loan a greater interest than that fixed by law shall be paid.
There must be a loan in contemplation of the parties and if there be a loan, however disguised, the contract will be usurious, if it be so in other respects. :here a loan was made of depreciated bank notes to be repaid in sound funds, to enable the borrower to pay a debt he owed dollar for dollar, it was considered as not being usur-ious. The bona fide sale of a note, bond or other security at a greater discount than would amount to legal interest, is not per se, a loan, although the note may be endorsed by the seller, and he remains responsible. ut, if a note, bond9 or other security be made with a view to evade the laws of usury, and afterwards sold for a less amount than the interest, the transaction will be considered a loan and a sale of a man&s own note, endorsed by himself, will, be considered a loan. lt is a general rule that a contract, which, in its inception, is unaffected by usury, can never be invalidated by any subse(uent usurious transaction. ;n the contrary, when the contract was
originally usurious, and there is a substitution by a new contract, the latter will generally be considered usurious. There must be a contract for the return of the money at all events9 for if the return of the principal with interest, or of the principal only, depend upon a contingency, there can be no usury9 but if the contingency extend only to interest, and the principal be beyond the reach of ha
