Table of Contents
Sec. 37-1. Legal rate. Accrual as addition to debt. Sec. 37-1. Legal rate. Accrual as addition to debt. (a) The compensation for
forbearance of property loaned at a fixed valuation, or for money, shall, in the absence
of any agreement to the contrary, be at the rate of eight per cent a year; and, in computing
interest, three hundred and sixty days may be considered to be a year. Sec. 37-1a. Payment of interest on commercial loans in excess of ten thousand
dollars. On any loan in excess of ten thousand dollars made to any person, corporation,
partnership or association engaged in commercial, manufacturing, industrial or nonconsumer pursuits the loan agreement may provide for the interest to be either paid currently
or to accrue, and, if such interest is to accrue, such accrued interest may be added to the
principal of the debt on which interest may be charged and collected. Sec. 37-2. No recovery after payment. No borrower of money shall be permitted
to set off or recover back, by any proceeding in court, any sum of money paid by way
of interest, discount or damages, for the detention of money, in excess of the rate of six
per cent a year. Sec. 37-3. Rate recoverable as damages. Section 37-3 is repealed. Sec. 37-3a. Rate recoverable as damages. Except as provided in sections 37-3b,
37-3c and 52-192a, interest at the rate of ten per cent a year, and no more, may be
recovered and allowed in civil actions or arbitration proceedings under chapter 909,
including actions to recover money loaned at a greater rate, as damages for the detention
of money after it becomes payable. Judgment may be given for the recovery of taxes
assessed and paid upon the loan, and the insurance upon the estate mortgaged to secure
the loan, whenever the borrower has agreed in writing to pay such taxes or insurance
or both. Whenever the maker of any contract is a resident of another state or the mortgage
security is located in another state, any obligee or holder of such contract, residing in
this state, may lawfully recover any agreed rate of interest or damages on such contract
until it is fully performed, not exceeding the legal rate of interest in the state where such
contract purports to have been made or such mortgage security is located. Sec. 37-3b. Rate of interest recoverable in negligence actions. (a) For a cause
of action arising on or after May 27, 1997, interest at the rate of ten per cent a year, and
no more, shall be recovered and allowed in any action to recover damages for injury to
the person, or to real or personal property, caused by negligence, computed from the
date that is twenty days after the date of judgment or the date that is ninety days after
the date of verdict, whichever is earlier, upon the amount of the judgment. Sec. 37-3c. Rate of interest recoverable in condemnation cases. The judgment
of compensation for a taking of property by eminent domain shall include interest at a
rate that is reasonable and just on the amount of the compensation awarded. If a court
does not set a rate of interest on the amount of compensation awarded, the interest shall
be calculated as follows: (1) If the period for which interest is owed does not exceed
one year, interest shall be calculated from the date of taking at an annual rate equal to
the coupon issue yield equivalent, as determined by the Secretary of the Treasury of the
United States, of the average accepted auction price for the last auction of fifty-two-
week United States treasury bills settled immediately prior to the date of taking; and
(2) if the period for which interest is owed exceeds one year, interest for the first year
shall be calculated pursuant to the provisions of subdivision (1) of this section and
interest for each additional year shall be calculated on the combined amount of principal,
which is the amount by which the compensation award exceeds the original condemnation deposit, plus accrued interest at an annual rate equal to the coupon yield equivalent,
as determined by the Secretary of the Treasury of the United States, of the average
accepted auction price for the last auction of fifty-two-week United States treasury bills
settled immediately prior to the beginning of each year for which interest is owed. Such
judgment shall not include interest on any funds deposited by the condemnor as compensation for the taking for the period after such deposited funds become available for
withdrawal by the condemnee. The interest shall accrue from the date of taking to the
date of payment. Sec. 37-4. Loans at greater rate than twelve per cent prohibited. No person and
no firm or corporation or agent thereof, other than a pawnbroker as provided in section
21-44, shall, as guarantor or otherwise, directly or indirectly, loan money to any person
and, directly or indirectly, charge, demand, accept or make any agreement to receive
therefor interest at a rate greater than twelve per cent per annum. Sec. 37-5. Notes not to be accepted for greater amounts than loaned. No person
and no firm or corporation, or agent thereof, shall, with intent to evade the provisions
of section 37-4, accept a note or notes for a greater amount than that actually loaned. Sec. 37-6. Certain expenses not to be charged to the borrower. No person and
no firm or corporation, or agent thereof, shall charge a borrower with any expense of
inquiry as to his financial responsibility or expense of negotiating a loan, or charge, at
the time of making the loan, the expense of collecting the interest and principal of the
loan, unless the total of such charges and of the interest agreed upon is, during any one
year, twelve per cent of the loan or less. Sec. 37-7. Penalty. Any person who, individually, or as a member of any firm, or
as an officer of any corporation, or as an agent of any firm or corporation, violates any
provision of section 37-4, 37-5 or 37-6 shall be fined not more than one thousand dollars
or imprisoned not more than six months or both. Sec. 37-8. Actions not to be brought on prohibited loans. No action shall be
brought to recover principal or interest, or any part thereof, on any loan prohibited by
sections 37-4, 37-5 and 37-6, or upon any cause arising from the negotiation of such loan. Sec. 37-9. Loans to which prohibitions do not apply. The provisions of sections
37-4, 37-5 and 37-6 shall not affect: (1) Any loan made prior to September 12, 1911;
(2) any loan made by (A) any bank, as defined in section 36a-2, or any out-of-state bank,
as defined in section 36a-2, that maintains in this state a branch, as defined in section
36a-410, (B) any wholly-owned subsidiary of such bank or out-of-state bank, except a
loan for consumer purposes, or (C) any Connecticut credit union, as defined in section
36a-2, or federal credit union, as defined in section 36a-2; (3) any bona fide mortgage
of real property for a sum in excess of five thousand dollars; (4) (A) any loan, carrying
an annual interest rate of not more than the deposit index determined pursuant to subsection (c) of section 49-2a for the calendar year in which the loan is made plus seventeen
per cent, made to a foreign or domestic corporation, statutory trust, limited liability
company, general, limited or limited liability partnership or association organized for
a profit or any individual, provided such corporation, trust, company, partnership, association or individual is engaged primarily in commercial, manufacturing, industrial or
nonconsumer pursuits and provided further that the funds received by such corporation,
trust, company, partnership, association or individual are utilized in such entity's business or investment activities and are not utilized for consumer purposes and provided
further that the original indebtedness to be repaid is in excess of ten thousand dollars
but less than or equal to two hundred fifty thousand dollars, or, in the case of one or
more advances of money of less than ten thousand dollars made pursuant to a revolving
loan agreement or similar agreement or a loan agreement providing for the making of
advances to the borrower from time to time up to an aggregate maximum amount, the
total principal amount of all loans owing by the borrower to the lender at the time of
any such advance is in excess of ten thousand dollars but less than or equal to two
hundred fifty thousand dollars, or (B) any loan made to a foreign or domestic corporation,
statutory trust, limited liability company, general, limited or limited liability partnership
or association organized for a profit or any individual, provided such corporation, trust,
company, partnership, association or individual is engaged primarily in commercial,
manufacturing, industrial or nonconsumer pursuits and provided further that the funds
received by such corporation, trust, company, partnership, association or individual are
utilized in such entity's business or investment activities and are not utilized for consumer purposes and provided further that the original indebtedness to be repaid is in
excess of two hundred fifty thousand dollars, or, in the case of one or more advances
of money of less than two hundred fifty thousand dollars made pursuant to a revolving
loan agreement or similar agreement or a loan agreement providing for the making of
advances to the borrower from time to time up to an aggregate maximum amount, the
total principal amount of all loans owing by the borrower to the lender at the time of
any such advance is in excess of two hundred fifty thousand dollars; (5) any obligations,
including bonds, notes or other obligations, issued by (A) the state, (B) any municipality,
including any city, town, borough, district, whether consolidated or not, or other public
body corporate, or (C) any authority, instrumentality, public agency or other political
subdivision of the state or of a municipality; (6) any loan made by (A) the state, (B) any
municipality, including any city, town, borough, district, whether consolidated or not,
or other public body corporate, or (C) any authority, instrumentality, public agency or
other political subdivision of the state or of a municipality; (7) any loan made for the
purpose of financing the purchase of a motor vehicle, a recreational vehicle or a boat,
carrying an interest rate of not more than (A) eighteen per cent per annum on loans made
on or after July 1, 1981, and prior to October 1, 1985, and (B) on loans made on or after
October 1, 1985, and prior to October 1, 1993, (i) sixteen per cent per annum for new
motor vehicles, recreational vehicles or boats, and (ii) eighteen per cent per annum for
used motor vehicles, recreational vehicles or boats, payable in four or more monthly,
quarterly or yearly installments which is unsecured or in which a security interest is
taken in such property; (8) any loan by an institution of higher education made to an
individual for the purpose of enabling attendance at such institution and carrying an
interest rate of not more than the greater of (A) the maximum rate then permitted by
section 37-4, or (B) a rate which is not more than five per cent in excess of the discount
rate, including any surcharge, on ninety-day commercial paper in effect from time to
time at the federal reserve bank in the federal reserve district where such institution is
located; (9) any loan made to a plan participant or beneficiary from an employee pension
benefit plan as defined in the Employee Retirement Income Security Act of 1974, Public
Law 93-406, as from time to time amended. The provisions of part III of chapter 668
shall not apply to loans made pursuant to subdivision (7) of this section. No provision
of this section shall prevent any such bank, out-of-state bank, Connecticut credit union
or federal credit union or other lender from recovering by an action at law the amount
of the principal and the interest stipulated or interest at the legal rate, if interest is not
stipulated, in any negotiable instrument which it has acquired for value and in good
faith without notice of illegality in the consideration. For the purpose of this section:
"Interest" shall not be construed to include attorney's fees, including preparation of
mortgage deed and note, security agreements, title search, waivers and closing fees,
survey charges or recording fees paid by the mortgagor or borrower; "consumer purposes" shall mean the utilization of funds for personal, family or household purchases,
acquisitions or uses.
Sec. 37-1a. Payment of interest on commercial loans in excess of ten thousand dollars.
Sec. 37-2. No recovery after payment.
Sec. 37-3. Rate recoverable as damages.
Sec. 37-3a. Rate recoverable as damages.
Sec. 37-3b. Rate of interest recoverable in negligence actions.
Sec. 37-3c. Rate of interest recoverable in condemnation cases.
Sec. 37-4. Loans at greater rate than twelve per cent prohibited.
Sec. 37-5. Notes not to be accepted for greater amounts than loaned.
Sec. 37-6. Certain expenses not to be charged to the borrower.
Sec. 37-7. Penalty.
Sec. 37-8. Actions not to be brought on prohibited loans.
Sec. 37-10.
(b) Unless otherwise provided by agreement, interest at the legal rate from the date
of maturity of a debt shall accrue as an addition to the debt.
(1949 Rev., S. 6776; 1971, P.A. 783, S. 1; P.A. 79-364, S. 1.)
History: 1971 act added new Subsec. (b) providing that interest shall accrue as an addition to the debt; P.A. 79-364
changed rate of interest from six to eight per cent in Subsec. (a).
Allowed because of contract express or implied or as damages. 22 C. 392; 72 C. 705. Note "with fifteen per cent after
maturity"; the per cent held to be interest and not damages. 42 C. 524. Effect of validating act subsequently repealed on
usurious contract for interest. 42 C. 574; 56 C. 214. A note on which the interest is payable quarterly at the legal rate is
not usurious. 44 C. 494. The law takes note of the running of interest at the legal rate where the principal is due. 56 C. 114.
The taking of interest in advance on a demand note constitutes an agreement to forbear for that time. 63 C. 87. Agreed rate
governs till default, then legal rate; exceptions. 78 C. 323. Generally, any rate agreed on is lawful. 76 C. 388. Effect of
insolvency of bank on its liability to pay interest. 88 C. 206. Cited. 126 C. 461; 147 C. 225. See note to Sec. 37-4. An
agreed interest rate will prevail over the stated rate in statute. 160 C. 534. Cited. 177 C. 149, 163.
Cited. 15 CA 718, 719. Cited. 44 CA 402.
Cited. 10 CS 240. Statutory rate of interest does not apply unless there is an expressed or implied agreement to pay
interest. 29 CS 114. Cited. 38 CS 610, 615. Cited. 41 CS 538−540.
Subsec. (a):
Cited. 186 C. 612, 614. Cited. 188 C. 316, 321.
Cited. 13 CA 330, 353.
Subsec. (b):
Cited. 188 C. 316, 321.
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(P.A. 83-225.)
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(1949 Rev., S. 6777.)
Cited. 193 C. 304, 309.
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(1949 Rev., S. 6778; 1961, P.A. 116, S. 19; 1971, P.A. 574; 783, S. 2.)
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(1972, P.A. 292, S. 1; P.A. 76-316, S. 1; P.A. 79-364, S. 2; P.A. 81-315, S. 1; P.A. 83-267, S. 1; P.A. 87-260, S. 2;
May Sp. Sess. P.A. 92-11, S. 10, 70.)
History: P.A. 76-316 added exception as provided in Sec. 52-192a; P.A. 79-364 applied section to arbitration proceedings; P.A. 81-315 added reference to Sec. 37-3b as an exception to this section; P.A. 83-267 increased rate of interest from
eight to ten per cent; P.A. 87-260 added reference to Sec. 37-3c as an exception to this section; May Sp. Sess. P.A. 92-11
deleted exception re recovery of interest with respect to demand obligations as provided in repealed Sec. 42a-3-122(4)(a).
Cited. 175 C. 138, 146. Cited. 178 C. 323, 334; 180 C. 11, 12, 47. Statute does not apply to interest payments ordered
by the public utilities control authority (PUCA). 183 C. 128, 146, 147. Challenge by general contractor to constitutionality
of mechanic's lien statutes discussed. 185 C. 583, 605. Where condemnation award contemplated payment of interest at
the prevailing statutory rate, court did not err in awarding interest at 6% from date of taking to October 1, 1979, when
statute was amended to provide for interest at 8% from that date to date of payment. 187 C. 171 et seq. Prejudgment and
postjudgment interest discussed with reference to Sec. 52-192a. 192 C. 301, 307, 308, 310. Determination of interest in
condemnation proceedings is not subject to provisions of the statute. Id., 377−380. Cited. 196 C. 81, 90. Increase in interest
rate only prospective in its operation. 199 C. 683, 686, 690, 691. Cited. 203 C. 324, 341. Cited. 207 C. 468, 482. Cited.
210 C. 734, 735, 748−750. Cited. 211 C. 648, 653. Cited. 213 C. 145, 160. Cited. 217 C. 281, 282, 296−298, 300−303.
Cited. 218 C. 628, 643. Cited. Id., 646, 653, 675, 676. Cited. Id., 681, 682, 701−703. Cited. 222 C. 480, 485, 501. Cited.
224 C. 758, 762, 765. Cited. Id., 766, 770, 771. Cited. 228 C. 206, 208, 213, 230. Cited. 234 C. 169, 170, 174, 175, 179,
181, 182. Cited. 235 C. 1, 2, 39, 41. Cited. 238 C. 293. Cited. 239 C. 144. Cited Id., 708. Cited. 240 C. 287. Cited. 241 C.
749. Interest payable on money wrongfully withheld calculated from date on which court determines the money was due
and payable. 247 C. 242.
Cited. 1 CA 595, 599. Held not an abuse of discretion for trial court to determine that statutory eight per cent interest
rate which became effective in 1979 should be applied to money due since 1973. 2 CA 322, 323, 329, 331. Cited. 3 CA
111, 116, 117. Cited. 6 CA 292, 298. Cited. Id., 417, 418, 428. Cited. Id., 447, 463. Cited. 12 CA 468, 477, 479. Cited. 13
CA 330, 353. Cited. 16 CA 705, 706, 708. Cited. 18 CA 559, 565. Cited. 20 CA 566, 569. Cited. Id., 676, 679. Cited. Id.,
680, 685. Cited. 21 CA 359, 364. Cited. Id., 380, 382. Cited. Id., 549−556. Cited. 22 CA 640, 651−654. Cited. 25 CA 529,
535. Cited. 27 CA 635, 639. Cited. 29 CA 484, 497, 498. Cited. 30 CA 136, 140, 141, 146. Cited. Id., 729, 736, 737. Cited.
31 CA 253, 255. Cited. Id., 455, 469. Inapplicable to punitive damages. 32 CA 133, 139, 140. Cited. 34 CA 27, 38. Cited.
35 CA 504−506, 508, 515−518. Cited. 36 CA 322, 327. Cited. 39 CA 122, 128, 129, 134, 136. Cited. 41 CA 302, 307,
308. Cited. 42 CA 712. Cited. 43 CA 645. Cited. 44 CA 402. Cited. Id., 490. Cited. 45 CA 543. Cited. 46 CA 37. Cited.
Id., 87.
Cited. 33 CS 609. Cited. 37 CS 50, 85. Cited. 38 CS 610, 615. Cited. 41 CS 538−540. Cited. 44 CS 207, 220.
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(b) If any plaintiff in such action files a postverdict or postjudgment motion or an
appeal, the recovery of interest by such plaintiff shall be tolled and interest shall not be
added to the judgment for the period that such postverdict or postjudgment motion or
appeal is pending before the court. The provisions of this subsection shall not apply if
the reason for the filing of a postverdict or postjudgment motion or appeal by the plaintiff
is to reply to or answer a motion or appeal filed by a defendant.
(P.A. 81-315, S. 2; P.A. 97-58, S. 2, 5.)
History: P.A. 97-58 designated existing provisions as Subsec. (a) and amended said Subsec. to make the recovery of
interest mandatory, rather than discretionary, for causes of action arising on or after May 27, 1997 and to provide that the
interest shall be computed "from the date that is twenty days after the date of judgment or the date that is ninety days after
the date of verdict, whichever is earlier, upon the amount of the judgment" rather than "from the date of judgment", and
added Subsec. (b) re the effect on the recovery of interest when the plaintiff files a postverdict or postjudgment motion or
an appeal, effective May 27, 1997.
Cited. 15 CA 381, 386. Cited. 31 CA 455, 469. Cited. 45 CA 543.
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(P.A. 87-260, S. 3; P.A. 95-343, S. 1, 2.)
History: P.A. 95-343 added provisions re calculation of interest applicable if court does not set rate of interest on amount
of compensation awarded, effective July 13, 1995.
Cited. 21 CA 359, 365.
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(1949 Rev., S. 6779.)
This section valid. 82 C. 232; 83 C. 1; 218 U.S. 563. Meaning of "mortgage"; assignment of wages. 82 C. 232. Whether
contract is made in evasion of this section is question of fact. 91 C. 601. Necessity of proving wrongful intent. 94 C. 148;
101 C. 558; 118 C. 4. Does not apply to "guarantee of loan." 93 C. 647. Particularity required in information. Id., 646.
Does not apply to receipt of higher rate of interest as a gift. Id., 668. Defense of usury on part of endorser in due course.
97 C. 320; 99 C. 684. Defense of usury of accommodation endorser with knowledge of usurious agreement. 101 C. 560;
102 C. 37. "Agreement" constitutes separate offense. 93 C. 669. A larger price fixed in good faith by a seller because sale
is on time and not for cash does not make contract usurious. 110 C. 259; 117 C. 254. History of usury statutes. 120 C. 665.
Voluntary taking or reservation of more than legal interest is per se usurious; specific intent to violate this section is not
essential. 123 C. 94. Intent to violate statute as a matter of law. 130 C. 552. Usurious note, found not to represent loan as
such but to constitute separate obligation given as collateral security, will not prevent recovery on loan. 124 C. 489. Renewal
notes as tainted with usury of original. 126 C. 339. Method of determining if note violates usury statutes; bonus for use of
money counts as interest. 130 C. 552. Cited. 107 C. 280; 111 C. 87; 113 C. 571; 125 C. 317; 128 C. 61; 130 C. 19. Jury
could reasonably have found that transaction was a usurious loan in violation of statute rather than a bona fide sale of the
note. 138 C. 636. Cited. 139 C. 425; 141 C. 301. Cited. 145 C. 342, 465. Cited. 149 C. 159; 153 C. 400. See note to section
37-5. Cited. 172 C. 395, 404. Cited. Id., 520, 525. Cited. 180 C. 491, 493, 494. Cited. 193 C. 304, 306. Cited. 211 C. 613, 621.
Cited. 2 CA 119, 120, 124. Statute does not apply to sales on credit. 3 CA 306−308. Cited. 6 CA 88, 94. Provisions of
this statute and Sec. 37-8 bar a deficiency judgment in this case. Id., 691, 692, 695. Cited. 21 CA 131−137. Cited. 27 CA
628, 629, 631. Cited. 31 CA 455, 469. Cited. 41 CA 754, 757. Cited. 44 CA 439. Cited. Id., 471. Statute does not apply
when indebtedness arose from purchase of educational and related services, rather than from a loan of money. 53 CA 455.
Cited. 1 CS 160. Promissory note and certificate of indebtedness executed simultaneously held to be one transaction
and the loan usurious. 6 CS 49. Payee not entitled to charge interest upon whole sum, only upon that part which remains
payable. 7 CS 424. Intent necessary to constitute usury. 8 CS 244. Does not apply to any loan made by any national bank
or any state bank or trust company incorporated in Connecticut. 32 CS 245. Cited. 36 CS 183, 184. Where there are only
a few percentage points difference in usury laws of this state and those of another state and both states have a substantial
relationship to the transaction, court will apply the usury laws of state which gives validity to the contract. 39 CS 510, 511.
Cited. 6 Conn. Cir. Ct. 283.
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(1949 Rev., S. 6780.)
Unlawful intent as well as acceptance must be proved. 94 C. 148; 101 C. 558; 118 C. 4. Intent to violate statute as a
matter of law. 130 C. 552. Cited. 113 C. 571; 117 C. 255; 120 C. 665; 123 C. 95; 126 C. 338. See notes to Secs. 37-4, 37-
8. Transactions between plaintiff and defendant were sales of notes and contracts and not usurious even though interest
exceeded 12%. 139 C. 424. Cited. 145 C. 465. Unless the difference between the actual amount of the loan and the face
amount of the note are explained to show that interest does not exceed twelve per cent, the loan is per se usurious and in
violation of section 37-4. 151 C. 21. Where lender was a seventy-eight-year old woman and borrower, an astute businessman,
persuaded lender not to seek legal counsel and to accept his note in an usurious amount, held no intent to evade provisions
of section 37-4. 153 C. 400, 406. Cited. 172 C. 395, 404. Cited. 188 C. 477, 480−482. Cited. 211 C. 613, 621.
Cited. 6 CA 691, 697. Cited. 21 CA 131, 134−136.
Cited. 1 CS 160. Does not apply to any loan made by any national bank or any state bank or trust company incorporated
in Connecticut. 32 CS 245.
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(1949 Rev., S. 6781.)
Cited. 113 C. 571; 120 C. 665; 145 C. 342, 465; 172 C. 395, 405. Cited. 211 C. 613, 621.
Cited. 6 CA 691, 692.
Cited. 1 CS 160.
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(1949 Rev., S. 6782.)
Cited. 126 C. 338; 149 C. 12.
Cited. 6 CA 691, 692. Cited. 44 CA 439. Cited. Id., 471.
Cited. 8 CS 245.
Cited. 6 Conn. Cir. Ct. 283.
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(1949 Rev., S. 6783.)
Acceptance of note appearing to be usurious on its face is not sufficient to invoke ban of this section; intent to evade
Sec. 37-4 must also be proved. 118 C. 4. Voluntary taking or reservation of more than legal interest is per se usurious;
specific intent to violate Sec. 37-4 is not essential. 123 C. 94; 130 C. 552. Where no evidence is offered to explain difference
between amount of note and actual loan, court may justifiably find note usurious. 126 C. 339. Cited. 111 C. 87; 120 C.
665. Statute makes no distinction between rights of an accommodation party who has participated in the usurious transaction
and one who has not. 138 C. 636. Cited. 139 C. 425. See notes to Secs. 37-4, 37-5. Where note which would be usurious
in Connecticut was executed in New York and payable there, action could be brought thereon in Connecticut, since
controlling statute re usury was that of New York. 149 C. 9. Same result where note was executed in Connecticut for
convenience of defendant cosigner but delivery was in Massachusetts. Id., 159. Where lender was a seventy-eight-year
old woman and borrower, an astute businessman, persuaded her not to seek legal counsel and to accept his note in an
usurious amount, action on note allowed. 153 C. 400, 406. Cited. 193 C. 304, 306. Cited. 211 C. 613, 621.
Cited. 3 CA 306, 307. Provisions of this statute and Sec. 37-4 bar a deficiency judgment in this case. 6 CA 691, 692,
695. Cited. 21 CA 131, 134, 137. Cited. 44 CA 439. Cited. Id., 471.
A conditional bill of sale given to avoid the usury statute is void. 1 CS 160. A first mortgage given to secure the
performance of an illegal and unenforceable loan is equally ineffective. 8 CS 245. Cited. 33 CS 554, 555.
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(1949 Rev., S. 6784; 1955, S. 2891d; 1959, P.A. 7, S. 1; 1967, P.A. 774; 1969, P.A. 573, S. 1; 804; P.A. 77-212, S. 1;
P.A. 78-121, S. 111, 113; P.A. 81-33, S. 1, 2; 81-267; 81-362, S. 1, 4; P.A. 82-313, S. 27, 28; P.A. 83-230, S. 1, 2; P.A.
84-546, S. 95, 173; P.A. 85-522, S. 3; P.A. 87-36, S. 2; 87-46; P.A. 89-329; P.A. 90-49; P.A. 91-306, S. 7; P.A. 98-46, S.
1, 2; P.A. 99-10; 99-158, S. 9.)
History: 1959 act included private bankers; 1967 act added survey charges to terms not construed to be included in
"interest"; 1969 acts added application of section to any federal or state chartered savings and loan associations, added
application to certain loans in excess of ten thousand dollars where interest rate is not more than eighteen per cent, added
preparation of security agreements to terms not construed to be included in "interest" and added "borrower" to "mortgagor"
in that reference; P.A. 77-212 added application of section to any credit union or federal credit union; P.A. 78-121 deleted
private bankers from application of section, effective January 1, 1979; P.A. 81-33 added Subdivs. (5) and (6) to exempt
obligations and loans of the state and its political subdivisions; P.A. 81-267 amended Subdiv. (2) to exempt nonconsumer
loans by a subsidiary of a national bank or bank or trust company, amended Subdiv. (4) by replacing the exemption for
business loans in excess of ten thousand dollars with an interest rate of not more than eighteen per cent with an exemption
for loans in excess of ten thousand dollars to business entities where the funds are used in the entity's business or investment
activities and are not used for consumer purposes, and added a definition of "consumer purposes"; P.A. 81-362 added
Subdiv. (7) to exempt certain loans made on or after July 1, 1981, and prior to March 1, 1983, with an interest rate of not
more than eighteen per cent for the purpose of financing the purchase of a motor vehicle, recreational vehicle or boat; P.A.
82-313 amended section to allow institutions of higher education which make loans to students to charge a rate of interest
in excess of that permitted by law; P.A. 83-230 amended Subdiv. (7) to extend March 1, 1983, to October 1, 1985; P.A.
84-546 made technical change to section; P.A. 85-522 amended Subdiv. (7) to establish a maximum interest rate of sixteen
per cent for new motor vehicles, recreational vehicles or boats and eighteen per cent for used motor vehicles, recreational
vehicles or boats, sold on or after October 1, 1985, and prior to October 1, 1987; P.A. 87-36 amended Subdiv. (2) to include
references to state or federal savings banks; P.A. 87-46 amended Subpara. (B) of Subdiv. (7) to extend the maximum
interest rate for motor vehicles, recreational vehicles or boats from October 1, 1987 to October 1, 1989; P.A. 89-329
amended Subpara. (B) of Subdiv. (7) by changing the date from October 1, 1989, to October 1, 1991, re the applicability
of the maximum interest rate for loans on motor vehicles, recreational vehicles or boats; P.A. 90-49 added Subdiv. (9) to
exempt loans made from employee pension benefit plans; P.A. 91-306 amended Subpara. (B) of Subdiv. (7) to extend the
maximum interest rate for motor vehicles, recreational vehicles or boats from October 1, 1991, to October 1, 1993; P.A.
98-46 amended Subdiv. (4) by adding statutory trusts, limited liability companies and limited liability partnerships or
associations, effective May 17, 1998, and applicable to loans made before, on or after said date; P.A. 99-10 changed former
references to various types of state and federally chartered financial institutions to the terms for such institutions as defined
in Secs. 36a-2 and 36a-410; P.A. 99-158 amended Subdiv. (4) by adding Subpara. (A) re loans carrying an interest rate of
not more than the deposit index plus seventeen per cent, designating existing provisions as Subpara. (B) and changing the
minimum indebtedness amount from ten thousand to two hundred fifty thousand dollars.
Exception of real property mortgages not unconstitutional. 113 C. 92. Mere inclusion of bonus in mortgage will not
destroy its bona fides. Id., 93. Mortgage not within exception where amount actually loaned was under $500. Id., 573.
Exception is limited to mortgage itself and does not permit action on the note alone. 120 C. 661; 123 C. 94. Industrial bank
is within exception. 125 C. 319. Cited. 126 C. 338. Inclusion in mortgage of bonus with intent to exact more than 12 per
cent interest does not of itself render mortgage invalid so as to take it out of the exception. 128 C. 57; 130 C. 558, Diss.
op. Construction of word "interest" applies to chapter generally. 145 C. 342. Attorney's fees paid by borrower cannot be
deducted in computing amount of loan. 145 C. 465. Cited. 172 C. 395, 404, 405. Cited. 180 C. 491, 493, 494. Cited. 188
C. 477, 480−482. Cited. 193 C. 304, 306.
Cited. 6 CA 691, 692. Cited. 21 CA 131, 135. Cited. 27 CA 628, 629, 631. Cited. 41 CA 754, 757.
Provision excepting mortgage also excepts the note which it secures. 3 CS 22; 8 CS 245. Bona fide defined. Id. Where
the note is not usurious as to the corporate maker, it is not usurious against an individual guarantor, though a note at such
interest on a loan to an individual would be usurious. 31 CS 154. Cited. 32 CS 245.
Subdiv. (3):
"Mortgage" construed to mean not only mortgage conveyance but also mortgage loan or loan secured by the mortgage.
Exemption permits deficiency judgment on mortgage loan of over five thousand dollars with an interest rate in excess of
twelve per cent per annum. 244 C. 189.
Cited. 2 CA 119, 124. Exemption does not apply to a deficiency judgment. 6 CA 691, 695. Cited. 44 CA 439.
Subdiv. (4):
Cited. 211 C. 613, 621.
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