# Commercial Law (GCL)

## Title 12. Credit Regulations

### Subtitle 1. Interest and Usury

#### Section 12-114.1

(a)

  (1) In this section the following words have the meanings indicated.

  (2)

    (i) "Covered loan" means a loan subject to Sec. 12-103(a)(3) or (c) of this subtitle, made for personal, family, or household purposes, regardless of whether the loan is or purports to be made under this subtitle.

    (ii) "Covered loan" does not include:

      (1) A loan or an advance of money or credit subject to Subtitle 3 of this title, unless a written election is made under Sec. 12-101.1 of this subtitle;

      (2) A plan or loan for which a written election has been made under Subtitle 3, Subtitle 4, Subtitle 9, or Subtitle 10 of this title; or

      (3) An installment sale agreement as defined in Sec. 12-601 of this title.

  (3) "Unlicensed person" means a person who is not:

    (i) Licensed in the State to make a covered loan; and

    (ii) Exempt from licensing in the State.

(b) This section applies to a covered loan made to any person.

(c)

  (1) An unlicensed person may not make a covered loan.

  (2) A person may not make a covered loan if the person directly or indirectly contracts for, charges, or receives a rate of interest, charge, discount, or other consideration that is greater than the amount authorized under State law.

  (3) A person may not make a covered loan that violates the federal Military Lending Act.

(d)

  (1) A covered loan made by an unlicensed person is void and unenforceable.

  (2)

    (i) Except as provided in subparagraph (ii) of this paragraph, a covered loan is void and unenforceable if a person contracts for a covered loan that has a rate of interest, charge, discount, or other consideration greater than the amount authorized under State law.

    (ii) A covered loan is not void and unenforceable if:

      (1) A clerical error or mistake resulted in the rate of interest, charge, discount, or other consideration being greater than the amount authorized under State law; and

      (2) A person corrects the error or mistake before the first payment is due under the loan.

  (3) A covered loan that violates the federal Military Lending Act is void and unenforceable.

  (4) With respect to a loan that is void and unenforceable under this section, a person may not:

    (i) Collect or attempt to collect, directly or indirectly, any amount from the borrower;

    (ii) Enforce or attempt to enforce the contract against any property securing the loan; or

    (iii) Sell, assign, or otherwise transfer the loan to another person.

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Md. Code Ann., Com. Law (as displayed at mgaleg.maryland.gov, October 16, 2026)