On February 13, 2025, the First Department issued a decision in ECO Engg., Inc. v. Source Renewables, LLC, 2025 NY Slip Op. 00826, holding that a loan’s default interest rate was not usurious when it applied only after maturity, explaining:
[D]efendants [are un]able to prove their affirmative defense of usury because both the plain text of the notes at issue and plaintiff’s conduct in billing only the non-usurious default rate post-maturity establishes that the notes are not usurious under the criminal usury statute.
Even if the default rate was over 25%, it would not be usurious where, as here, it was applied only after maturity, and the borrower had the power to avoid paying the higher rate — for example, by timely paying the debt.
(Internal citations omitted).