Bill > HB1606

This bill establishes a maximum annual interest rate of 6% for certain financial obligations held by active service members, meaning individuals currently serving in the armed forces, or jointly by an active service member and their spouse. This protection applies to obligations like loans or other financing arrangements. If a service member is called to active duty during the repayment of an obligation, any interest charges exceeding 6% will be forgiven, and periodic payments will be recalculated at the reduced rate. To benefit from this interest rate reduction, the service member or their spouse must provide the creditor with written notice and copies of military orders within 180 days after the service member is discharged from active duty. However, a court can allow a creditor to bypass this interest rate limit if it finds that the service member's or their spouse's ability to pay higher interest charges is not significantly impacted by the active duty assignment. This legislation is set to take effect on July 1, 2026.

Government Affairs

https://mgaleg.maryland.gov/mgawebsite/Legislation/Details/HB1606?ys=2026RS