Maximum Permissible Interest Rate Clause Samples
The Maximum Permissible Interest Rate clause sets a cap on the amount of interest that can be charged under an agreement, ensuring it does not exceed the highest rate allowed by applicable law. In practice, this clause applies to any interest payments due, such as those on overdue amounts or loans, and automatically adjusts the rate downward if the agreed rate would otherwise be unlawful. Its core function is to protect both parties from inadvertently violating usury laws, thereby preventing the contract from being rendered unenforceable or subject to penalties due to excessive interest charges.
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Maximum Permissible Interest Rate. In the event that, notwithstanding Paragraphs 4.1 through 4.3 hereof, any sum payable hereunder as a Profits Interest is adjudicated as constituting interest, then in no contingency or event whatsoever, shall the amount payable hereunder or under any other agreement between Seller and Purchaser exceed the highest lawful rate permissible under the applicable usury law. If, from any circumstance whatsoever, fulfillment of any provision of this Agreement or any other agreement between Seller an Purchaser, at the time performance of such provision shall be due, shall involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable hereto, then, ipso facto, the obligation to be fulfilled shall be reduced to the limit of such validity, and if from any circumstance, Seller shall receive as interest an amount which would exceed the highest lawful rate, such amount which would be excessive interest shall be refunded to Purchaser. All sums paid, or agreed to be paid, to Purchaser for the use, forbearance or detention of the indebtedness of Purchaser to Seller shall be amortized, prorated, allocated and spread throughout the full term of this Agreement so that the actual rate of interest on account of such indebtedness is uniform throughout the term thereof.
Maximum Permissible Interest Rate. The Borrower shall not be obligated to pay and the Lender shall not collect interest at a rate higher than the maximum permitted by law or the maximum that will not subject the Lender to any civil or criminal penalties. If, because of the acceleration of maturity the payment of interest in advance or any other reason, the Borrower is required, under the provisions of any Loan Document or otherwise, to pay interest at a rate in excess of such maximum rate, the rate of interest under such provisions shall immediately and automatically be reduced to such maximum rate and any payment made in excess of such maximum rate, together with interest thereon at the rate provided herein from the date of such payment, shall be immediately and automatically applied to the reduction of the unpaid principal balance of this Note as of the date on which such excess payment was made. If the amount to be so applied to reduction of the unpaid principal balance exceeds the unpaid principal balance, the amount of such excess shall be refunded by the Lender to the Borrower.
Maximum Permissible Interest Rate. No provision of this Note establishes or requires the payment of Interest at a rate in excess of the maximum rate permitted by law. If the Interest required to be paid under this Note exceeds the maximum rate permitted by law, it will automatically be reduced to the maximum rate permitted by law. If any Interest paid exceeds the then applicable legal rate, the excess Interest paid over the maximum amount permitted by law will automatically be applied:
(a) to reduce any unpaid costs,
(b) to reduce any accrued and unpaid Interest, and then
(c) to reduce Principal. Any remaining balance will be refunded to Borrower.
Maximum Permissible Interest Rate. In no contingency or event whatsoever, whether by reason of advancement of the proceeds under the Note, acceleration or maturity of the unpaid principal balance of the Note, or otherwise, shall the amount paid or agreed to be paid to the holder thereof for the use, forbearance or detention of the money to be advanced thereunder exceed the highest lawful rate permissible under applicable usury laws. If, from any circumstances whatsoever, the fulfillment of any provisions of this Note or any other agreement referred to herein or otherwise relating to the Note, at the time that performance of such provisions shall be due, shall involve exceeding the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable hereto, then IPSO FACTO, the obligation to be fulfilled shall be reduced to the limit of such validity, and if from any circumstance, Payee shall ever receive as interest an amount which would exceed the highest lawful rate, such amount which would be excessive interest shall be applied to the reduction of the unpaid principal balance due thereunder as of the date such amount is received or deemed to be received by Payee and not the payment of interest. Notwithstanding the foregoing, if the provisions of any law or regulation of the United states or any agency or instrumentality thereof, as amended, would permit the holder of this Note to charge or receive a rate of interest with respect to the indebtedness (if any) in excess of the maximum rate of interest (if any) permitted to be charged or received by the holder under applicable laws of the State of California, the less restrictive provisions of any such United Sates law or regulation shall apply in determining the rate of interest permitted to be charged or received.