Q: What is the maximum interest rate on a retail installment contract
Assuming this relates to a contract executed in New York, the short answer is that there is none. Under the "time price doctrine" a retail installment sale has for hundreds of years been deemed not to be a loan of money subject to the usury laws. New York's Retail Installment Sales Act was amended in 1994 to make explicit that the maximum interest rate that may be charged is whatever rate is written in the contract.
Having said that, if this question is important enough you may want to consult with a consumer attorney, because there are circumstances where the transaction will be deemed a loan subject to the usury laws despite being documented as a retail installment sale, on the theory that the latter is a fiction. For example, where car dealers execute installment sale contracts that are immediately assigned to a bank, courts sometimes will hold that the transaction is really a loan from the bank and documenting it as an installment sale is just a sham to avoid the usury limit. If there is an argument to be made that the usury limit applies, then the limit would be 16% currently in New York.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.