Consumer credit: interest rates; prepayment penalties on certain mortgage loans made for business purposes; allow. Amends sec. 1c of 1966 PA 326 (MCL 438.31c).
Key claim: HB5552 would amend Michigan’s interest-rate statute to allow prepayment penalties on certain mortgage loans made for business purposes.
Abstract
(HB5552 · 103rd Legislature) Consumer credit: interest rates; prepayment penalties on certain mortgage loans made for business purposes; allow. Amends sec. 1c of 1966 PA 326 (MCL 438.31c). Sponsor: Rep. Mark Tisdel ® + 3 co-sponsors In committee: S Finance, Insurance, And Consumer Protection Latest vote: House Third Reading: Given Immediate Effect Roll Call #164 — 81-26 (passed, 2026-05-21) Latest action (2026-06-02): Referred To Committee On Finance, Insurance, And Consumer Protection
Why this matters
Michigan’s usury/consumer-credit statute currently constrains prepayment penalties, and this amendment would give business-purpose mortgage lenders greater flexibility to price prepayment risk into loan terms. For business borrowers, that could mean lower headline rates but higher costs to refinance or pay off early, while lenders gain a clearer statutory basis to enforce such penalties.