Legal Question in Credit and Debt Law in Massachusetts

Re: What rate of interest must be charged to qualify as 'loan-sharking'?

Yes, loan-sharking is illegal. There are many laws, some

required in combination. Many of the criminal charges fall under

federal law.

I assume, that you are interested

only in excessive interest rate charges, which I would label

with the more specific term "usury".

Even for just usury, there are several laws involved. They depend

upon the parties involved (whether the lender is regulated by the banking

commission, for example, and whether the borrower is a consumer or a

merchant), the nature of the agreement (loan, guarantee, etc.),

the amount of the loan (under/over $1,000, $4,000 or $6,000 for small loans),

and various other aspects (home mortgage, variable rate, revolving

credit types of loans, etc.)

MGL Ch. 271 Sec. 49 applies to SOME loans and provides criminal penalties for

charging more than 20% for those loans. It is a criminal statute, i.e., it

can get the lender locked up (or fined) but doesn't necessarily relieve you of

civil liability for the loan, at least not by itself. You really need other statutes.

There are statutes which define the relief a borrower can get from a usurious lender,

i.e., the penalty the lender must pay to the borrower.

In Massachusetts General Laws, you could look into this list of chapters to find

laws of interest:

106, 107, 140, 140D, 158, 167E, 172A, 255B, 255D, and 271.

However, some of them refer to rates set by committees and regulatory boards, so

not all of the rates are even in the statutes.

What's your actual story? Who charged what to whom on what size loan with what

repayment terms? Was there a written agreement? Is there a threat of physical

harm involved?