Be it enacted by the Senate and  House of Representatives of the Philippines in Legislature assembled and by  the authority of the same:

SECTION 1. Section  two of Act  Numbered  Twenty-six hundred and  fifty-five, commonly known as the Usury Law, is  hereby amended to read as follows:

"SEC. 2. No person  or  corporation  shall directly or  indirectly take or  receive in money or  other property, real or personal,  a higher  rate of interest  or greater sum or value, including commissions, for the loan or renewal thereof or  forbearance of money, goods,  or credits, where such loan or renewal  or forbearance  is secured in  whole or in part by a mortgage upon real estate  the title to which is duly registered, or by any document  conveying  such real estate or an  interest therein., than twelve per centum, per annum.   Mutual building and loan societies incorporated under  Act Numbered  Fourteen  hundred  and  fifty-nine, known as the Corporation Act  may,  however,  charge  in addition a premium the percentage of which shall be fixed from time  to time by  their boards  of directors  but shall in  no case exceed  two per centum  per annum,  computed in  annual payments from  the date when the loan was made until the  day  when  the obligation is totally extinguished."

SEC. 2. Section four  of  Act  Numbered Twenty-six hundred and fifty-five is hereby amended to read as follows:

"SEC.  4.  No pawnbroker  or pawnbroker's  agent shall directly or indirectly take  or  receive  any  higher rate  or greater sum or value for any loan or forbearance  than two and one-half per  centum  per month when the  sum  lent is less than  one hundred  pesos; two per centum per  month when the sum lent  is one hundred pesos or more, but not exceeding five hundred pesos, and fourteen per centum per annum when it  is more than the amount last mentioned.

A pawnbroker or  pawnbroker's agent shall be considered such, for the benefits of this Act only if he be duly licensed and has  further an establishment open to the public.

"It shall be unlawful for a pawnbroker or pawnbroker's agent to divide the pawn offered  by a person into two  or more fractions in order to collect greater interest than that permitted by this section.

"It shall also  be unlawful for a pawnbroker or pawn broker's agent to require the pawner to pay an additional charge as insurance premium for  the  safekeeping and conservation  of the article pawned."

SEC. 3. Section  five of Act Numbered Twenty-six hundred  and fifty-five, commonly known as the Usury Law, is hereby amended to read as follows:

"SEC. 5. In computing the interest on any  obligation, promissory note  or other instrument or contract, compound interest shall not be reckoned, except by  agreement,  or, in default thereof, whenever the  debt is  judicially claimed, in which last case  it shall draw six per centum per annum interest.   No person  or corporation  shall require interest to be paid in advance for a period of more than one year."

SEC. 4.  Section six of Act Numbered Twenty-six hundred and fifty-five, commonly known  as the Usury Law, is hereby amended to read as follows:

"SEC. 6. Any  person or corporation who, for any such loan or renewal thereof or  forbearance,  shall have paid or  delivered a higher rate  or  greater sum or value than is hereinbefore allowed  to be  taken or  received, may recover the whole interest, commissions and  premiums paid or  delivered  in  excess, with costs and  attorney's fees  in such  sum as  may be allowed  by the court in an  action against the person or  corporation  who  took  or  received it,  if such action is brought within., two years after such payment  or delivery:  Provided, however, That the creditor shall not be obliged to return the interest and commissions for a period of  not more than one year collected by him in advance when the  debtor shall have paid the obligation before it  is due, provided such interest  and commissions do not exceed the rates fixed in this Act."

SEC. 5.  Section seven of Act  Numbered  Twenty-six hundred and  fifty-five, commonly known as the Usury Law, is hereby amended to read as follows:

"SEC.  7. All  covenants  and  stipulations contained  in conveyances,  mortgages, bonds, bills,  notes, and other contracts or  evidences of debt,  and  all  deposits of goods  or other things,  whereupon or whereby there shall be reserved, secured, taken, or received, directly or indirectly, a higher rate of greater sum or value for the loan or renewal thereof or forbearance of money, goods, or  credits,than is herein- before allowed, shall be void:'. Provided,  however, That no merely clerical error in the  computation of interest,  made without intent to evade  any of the provisions of this Act shall render a contract  void: And provided, further, That nothing herein contained shall be construed to prevent the Purchase  by  an innocent purchaser of negotiable  mercantile paper, usurious or otherwise, for valuable consideration before maturity, when there has been no intent on the part of said purchaser to evade the provisions of this Act and said  purchase  was not  a part  of  the original usurious transaction.   In any case,  however, the  maker  of  said note  shall have the right to recover  from  said  original' holder  the whole  interest paid  by  him thereon  and, in case  of litigation,  also the costs and such attorney's  fees as may be allowed by the court."

SEC. 6.  This Act shall take effect on its approval; but it shall not apply to pending transactions or obligations contracted prior to its  approval, except renewals thereof made after the date on  which this  .Act takes effect.

Approved,  December  2, 1926.