What a payday loan costs — before Maryland’s rules
A payday loan typically costs $15–$20 per $100 borrowed for a two-week term — roughly 400% APR — and is due as a single lump sum on your next payday. That single-payment structure, not the fee on any one loan, is the trap: most fees come from borrowers who cannot clear the balance in one go and roll it over. Where a state caps rates below payday levels, licensed payday lending disappears and a loan above the cap is generally void — not legally collectible, whatever the contract says.
The law in Maryland
- Rate cap
- 33% APR maximum (roughly 24–33% depending on loan size); payday loans have been effectively illegal since 2002.
- Key law
- Maryland consumer-loan usury cap (made payday illegal in 2002); enforced by the Office of Financial Regulation.
- Enforcement
- In February 2011 the Commissioner issued a cease-and-desist against Western Sky Financial and Martin Webb, culminating in a $2 million settlement with Western Sky, CashCall and related parties (2014).
Maryland secured a $2 million settlement with Western Sky/CashCall; one challenged loan carried an APR of more than 1,800%.
What it means for a Maryland borrower
Loans above 33% APR are usurious and unenforceable, so tribal and payday high-interest loans are restricted and challengeable in Maryland. The state actively halted Western Sky’s lending and delivered redress.
If you already have a payday loan in Maryland
A loan that violates Maryland’s rate limits may be partly or fully unenforceable — which changes your options with the lender and any collector. This is general information, not legal advice.
- File a complaint with the Maryland Office of the Commissioner of Financial Regulation.
- Loans above the 33% cap are illegal and may be void — dispute the debt.
Cheaper first — try these before a payday loan in Maryland
Payday Loans and tribal lenders in Maryland
Many online lenders that market payday loans to Maryland residents are tribal lenders arguing their sovereignty places them outside state rate caps — a separate legal question this site tracks in depth. For which tribal brands lend to Maryland residents and how state law applies to them, see the Maryland tribal-lending page.
Tribal loans in Maryland →Frequently asked questions
Are payday loans legal in Maryland?
In Maryland, payday loans are legal but tightly limited. The state caps loan size, fees or rollovers, so a legal payday loan looks different — and costs less — than the ~400% APR norm, and any lender exceeding those limits is out of compliance.
What is the maximum payday loan rate in Maryland?
33% APR maximum (roughly 24–33% depending on loan size); payday loans have been effectively illegal since 2002.
What can I do about a payday loan I already have in Maryland?
Because Maryland restricts high-cost payday loans, a loan that exceeds the state limit may be partly or fully uncollectible. File a complaint with the Maryland Office of the Commissioner of Financial Regulation. This is general information, not legal advice.