O.C.G.A. § 7-4-8 (2019)
Commission to third person does not make lawful interest usurious
Except as the application of this Code section is modified by Code Section 7-3-5, where the lender neither takes nor contracts to take more than lawful interest, the loan is not rendered usurious by money paid or agreed to be paid others by the borrower in order to obtain the loan.
History
Civil Code 1895, § 2887; Civil Code 1910, § 3437; Code 1933, § 57-104; Ga. L. 1957, p. 331, § 3. History of Code section. This Code section is derived from the decisions in Merck v. American Freehold Land Mfg. Co., 79 Ga. 213, 7 S.E. 265 (1887), and Hughes v. Griswold, 82 Ga. 299, 9 S.E. 1092 (1889).
Annotations
Editor’s notes. Code Section 7-3-5, referred to in this
Code section, was repealed by Ga. L. 2020, p. 156, § 2/SB462, effective June 30, 2020. Law reviews. For note discussing the applicability of the usury laws to legitimate brokers’ commissions, see 12 Ga. L. Rev. 814 (1978). For article discussing methods of computation of finance charges in Georgia consumer credit contracts, see 30 Mercer L. Rev. 281 (1978).
JUDICIAL DECISIONS Commission to surety is not usurious. - Premium or commission paid by principal maker of promissory note to endorser or surety to protect latter in risk assumed and to compensate the endorser for the endorser’s services in procuring loan for which note is given, in which premium or commission lender has no interest, is in no sense usury. Jones v. Norton, 9 Ga. App. 333, 71 S.E. 687, 1911
Ga. App. LEXIS 540 (1911); Morgan v. Shepherd, 171 Ga. 33, 154 S.E. 780, 1930 Ga. LEXIS 277 (1930). Whether one is agent of borrower or of lender is question for jury. - Question whether agent was agent of borrower or of lender is question of fact which should be decided by jury. Williams v. Forman, 18 Ga. App. 242, 89 S.E. 459, 1916 Ga. App. LEXIS 258 (1916).
RESEARCH REFERENCES Am. Jur. 2d. 45 Am. Jur. 2d, Interest and Usury, § 153 et seq. C.J.S. 47 C.J.S., Interest and Usury Consumer Credit, § 243. ALR. Usury: expenses or charges (including taxes) incident to loan of money, 53 A.L.R. 743; 63 A.L.R. 823; 105 A.L.R. 795.
Usury: expenses or charges in form of commissions to agents, brokers, or like intermediaries incident to loan of money, 52 A.L.R.2d 703. Payments under (ostensibly) independent contract as usury, 81 A.L.R.2d 1280. Usury: charging borrower for or with expense or trouble of procuring money loaned, 91 A.L.R.2d 1389.