Q: Do I need a Maryland Consumer Loan license to lend a friend $6,000.00 and charge 14% interest for a four year term?
A: Your question involves at least two areas of commercial law in this state-- interest rates and lender licensing.
Maryland's laws on lending and usury (maximum interest) are a bit complicated. The legal rate of interest in this state is 6%. To charge more, you must fit within an exemption. For instance, if there is a written loan document, the interest can increase to 8%. There are a lot of rules and a lot of different situations with interest rates that can increase to 18% or higher, but the exceptions may or may not apply. Very, very generally, most loans at or under 8% satisfy the usury laws so long as the borrower signs a written agreement and the lender is either licensed or exempt from licensure.
Secondly, to lend money someone may or may not need a license. Some of the rules relate to what type of loan, some relate to how much the loan is for, some to the length of the loan and some apply depending on what security is offered for the loan. Under section 12-302 of the Commercial Law article, someone may not make a consumer loan unless they are A) licensed or B) exempt from licensure. You can check out this and many of the loan related laws in the Commercial Law article of the Maryland Annotated Code. Maryland's Attorney General may also offer some publications of general assistance.
While not legal advice I hope that this helps.
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