Usury refers to what practice?

• A. The practice of delaying payments
• B. The practice of charging the maximum allowable interest
• C. The practice of securing loans with collateral
• D. The practice of charging more than legally allowable interest

Answer: (D)

Usury is the practice of charging interest that exceeds the legally allowed limit. It targets the idea of going beyond what the law permits for borrowing costs, which is why the correct description is charging more than legally allowable interest. Lenders must follow usury laws that set caps on interest rates, though there are exemptions for certain institutions or loan types in some jurisdictions.

The other ideas describe unrelated loan practices: delaying payments is simply a deferment or forbearance, securing a loan with collateral is about providing security for the loan, and charging the maximum allowable interest could be legal if within the legal cap, but it’s not, by itself, what usury means.