Bill > HB5552

This bill amends existing Michigan law concerning interest rates on consumer credit, specifically allowing prepayment penalties on certain mortgage loans made for business purposes. The changes primarily involve clarifying existing provisions and introducing new language related to loan terms and conditions. For instance, it updates references to federal laws and regulations, such as the Securities Exchange Act of 1934 and the Truth in Lending Act, by replacing older citations with current United States Code (USC) and Code of Federal Regulations (CFR) references. A significant change is the modification of subsection (2)(c), which previously restricted prepayment fees on loans for personal, family, or household purposes to a maximum of 1% within the first three years and prohibited them thereafter; the amendment now specifies that this restriction applies *only* if the loan is made for personal, family, or household purposes, thereby allowing prepayment penalties on business-purpose loans. Additionally, the bill clarifies definitions and adds new definitions for terms like "affiliate" in the context of financial institutions offering biweekly payment mortgage options.