Final answer:
Late fees on a Section 32 loan are limited to 4% of the past due payment. If a usury law limits interest rates to no more than 35%, the number of loans made may decrease, especially for high-risk borrowers, and interest rates paid by borrowers might also decrease if they were above the cap previously.
Step-by-step explanation:
On a Section 32 loan, late fees are restricted to 4% of the amount of the past due payment. When it comes to usury laws, if the interest rates were capped at a maximum of 35%, it would likely have an impact on both the amount of loans made and the interest rates paid. When lenders are restricted from charging interest rates above a certain level, they might reduce the number of loans they make to higher risk borrowers. This is because high interest rates are often charged by lenders to compensate for the increased risk of default associated with these loans. By capping interest rates, the risk becomes less profitable, causing lenders to be more selective in their lending.
Furthermore, the interest rates paid by borrowers are likely to decrease if previously they were paying rates above the usury cap. On the other hand, the availability of loans may decrease, particularly for high-risk borrowers, as a direct result of the usury law capping interest rates.