Legal Question in Credit and Debt Law in Maryland

To answer your question, an attorney would need to know at a bare minimum when you borrowed the money and at what interest rate. In Maryland, the legal rate of interest is 6% (note that there are many exceptions and many creditors that can legally charge a higher rate). Once you have a basic idea of the date and interest rate, it would be a very good idea to run a basic loan amortization schedule. For instance, borrowing $4000 and paying it off over 10 years with interest will involve significantly greater payments over the life of the loan than say borrowing the same amount and paying it off over 3 years.

I strongly encourage people to put loan details in writing before ever borrowing money to avoid the kind of problems you now face. While verbal contracts can be legally binding, the lending party may find it difficult to enforce claims from a verbal contract in court. In any event, you may want to hunt down copies of all canceled checks so that you have a clear record of payments you made. A simple letter describing the payments you made and attaching the amortization schedule may possibly help clear up any disagreements.