§ 5-5-108 — Extortionate extensions of credit

(1) If it is the understanding of
the creditor and the consumer at the time an extension of credit is made that delay
in making repayment or failure to make repayment could result in the use of
violence or other criminal means to cause harm to the person, reputation, or
property of any person, the repayment of the extension of credit is unenforceable
through civil judicial processes against the consumer.

(2) If it is shown that an extension of credit was made at an annual
percentage rate exceeding forty-five percent calculated according to the actuarial
method and that the creditor then had a reputation for the use or threat of use of
violence or other criminal means to cause harm to the person, reputation, or
property of any person to collect extensions of credit or to punish the nonpayment
thereof, there is prima facie evidence that the extension of credit was
unenforceable under subsection (1) of this section.

Legislative History

Source: L. 2000: Entire article R&RE, p. 1235, � 1, effective July 1.