The bill amends the 1966 PA 326, which regulates the rate of interest on money, specifically focusing on the provisions related to interest charged by brokers or dealers registered under the Securities Exchange Act of 1934. It clarifies that interest on a debit balance in a customer account is not subject to the limitations of this act if the balance is payable on demand and secured by stocks or bonds. Additionally, it allows parties to certain financial agreements, such as notes or land contracts, to agree in writing on any rate of interest, provided that the initial rate cannot be increased for any reason. The bill also introduces various stipulations regarding loan conditions, including restrictions on prepayment fees and the requirement for lenders to not impose certain conditions on borrowers.

Furthermore, the bill specifies that interest rates for certain loans, including those secured by real property or mobile homes, must not exceed 11% per annum and must include all finance charges as defined by federal law. It also outlines the conditions under which lenders may require deposit accounts as part of mortgage or land contract agreements, ensuring that these accounts are used to facilitate payments. The amendments include several changes in legal language, such as replacing "shall" with "must" to emphasize obligations, and clarifying definitions related to financial transactions. The enactment of this bill is contingent upon the passage of another related bill in the legislature.

Statutes affected:
House Introduced Bill: 438.31