We’ve all gotten those credit card offers in the mail or online and they sound great. Maybe we like the idea of having a little extra shopping money, or we’re in a bind and need a new credit card to pay a bill. Whatever our reasons, we can get into some sticky situations using credit cards, especially when the interest we’re paying on our purchases is high.
Luckily, the Green Mountain State has some protections when it comes to interests rates. Here’s a brief summary of interest rates laws in Vermont.
Vermont Interest Rate Laws
When considering a personal loans in Vermont, the statutory interest rate for these types of unsecured, consumer loans is 12 percent. This is the maximum interest that can be charged on any personal, consumer loan in the State of Vermont. This is the maximum interest rate whether money is lent to the consumer by another individual or by a company of some sort. In addition to these regulations, there are separate provisions that deal with in unions.
Retail Installment Contracts
When it comes to retail installment sales, the maximum interest rate for the first $500 under such an agreement is 18 percent. The maximum interest that can be charged under such an agreement above the $500 level is 15 percent
The best way to avoid extremely high interest rates is to do your best to avoid credit card debt in the first place. This is certainly easier said than done. Even if you do have credit debt, you still have some consumer protections under federal law as a consumer. See Consumer Protection Resources for more information.
| Statute | Title 09, Chapter 004 |
| Legal Maximum Rate of Interest | 12 percent (Tit. 9 §41a) |
| Penalty for Usury (Unlawful Interest Rate) | Lender knowingly charging in excess of legal rate may forfeit all interest, all expenses of collection, and reasonable attorney's fee; first offense: fined not more than $500 and/or imprisoned for not more than 6 (six) months; subsequent offenses: fined not more than $1,000 and or imprisoned for not more than one (1) year (Tit. 9 §50) |
| Interest Rates on Judgments | 12 percent (Tit. 12 §2903) |
| Exceptions | For a retail installment contract the finance charge shall not exceed 18 percent per annum of the first $500.00 of the balance subject to finance charges and 15 percent per annum of the balance subject to finance charges in excess of $500.00. |
Note: Vermont state interest laws are constantly changing -- contact a Vermont consumer protection attorney or conduct your own legal research to verify the state law(s) you are researching.
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