tumor said:Could someone explain to me what is the deal with the usury or interest on loans stuff?Some people claim that it is immoral to claim usury(interests)on loans, while others have no problem with that.
If we had no usury in our day to day banking in what way would our lives and economy be different?
Usury, also known as interest on loans, is the practice of charging a certain percentage of the principal amount of a loan as a fee for borrowing money. This fee is usually calculated annually and is added to the total amount that the borrower must repay.
Usury can significantly impact borrowers by increasing the overall amount they owe on a loan. This can make it more challenging for borrowers to repay the loan, potentially leading to financial difficulties and debt. It can also make it harder for borrowers to access credit in the future.
Lenders charge interest on loans as a way to make a profit. By charging interest, lenders can earn money on the loans they provide and cover any potential risks associated with lending money. Interest rates can also reflect the current market conditions and the borrower's creditworthiness.
The legality of usury varies depending on the country and jurisdiction. In some places, there are laws that limit the amount of interest that lenders can charge. In other areas, there may be no specific laws regarding usury, but lenders are expected to follow ethical guidelines when setting interest rates.
Borrowers can protect themselves from usury by carefully reading and understanding the terms and conditions of a loan before signing. It's essential to compare interest rates from different lenders and choose one with reasonable rates. Borrowers can also seek advice from financial experts to ensure they are making informed decisions about borrowing money.