1. The loan contract violates the provisions of the contract law on interest rates.

2. According to Article 7 of Several Opinions on People's Courts Handling Loan Cases, lenders may not include interest in the principal to seek high profits. If it is found during the trial that the creditor included the interest in the principal to calculate compound interest, if the interest rate exceeds the limit stipulated in Article 6, the excess interest will not be protected.

3. Private lending contracts with legal persons or other organizations other than banks or financial institutions as lenders are invalid.

4. In private lending, the lender knows that the borrower borrows money for illegal activities, and its loan contract is invalid and not protected by contract law.

5. According to the provisions of the judicial interpretation, if the lender who borrows money from each other or the investor who actually borrows money fails to obtain the agreed interest, the people's court shall confirm that the loan contract relationship or joint venture contract relationship between the two parties is invalid during the trial, and collect the agreed interest according to law.

legal ground

Article 2 1 1 of the Contract Law stipulates that if interest is paid in the loan contract between natural persons, the loan interest rate shall not violate the provisions of the state on limiting the loan interest rate. "Several Opinions on People's Courts Handling Lending Cases" clearly states that the interest rate of private lending shall not exceed four times that of similar loans of banks.

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