INTEREST RATES
Act 326 of 1966
438.31 Legal interest rate; scope; limitation; construction; foreign obligations.
Sec. 1.
The interest of money shall be at the rate of $5.00 upon $100.00 for a year, and at the same rate for a greater or less sum, and for a longer or shorter time, except that in all cases it shall be lawful for the parties to stipulate in writing for the payment of any rate of interest, not exceeding 7% per annum. This act shall not apply to the rate of interest on any note, bond or other evidence of indebtedness issued by any corporation, association or person, the issue and rate of interest of which have been expressly authorized by the public service commission or the securities bureau of the department of commerce, or is regulated by any other law of this state, or of the United States, nor shall it apply to any time price differential which may be charged upon sales of goods or services on credit. This act shall not be construed to repeal section 78 of Act No. 327 of the Public Acts of 1931, as amended, being section 450.78 of the Compiled Laws of 1948. This act shall not render unlawful, the purchase of any note, bond or other evidence of indebtedness theretofore issued by any borrower not then domiciled in this state, which bear any rate of interest which is lawful under the law of the domicile of the borrower at the date of issue thereof, and in such case any such rate of interest may be charged and received by any person, firm, corporation or association in this state.
History: 1966, Act 326, Eff. Mar. 10, 1967 ;-- Am. 1970, Act 227, Imd. Eff. Nov. 25, 1970
PopularName Notes:
Usury Act
Notes of Decisions
Gordon Sel-Way, Inc. v. Spence Bros., 475 N.W.2d 704 (Mich. 1991).
· cites it 8× “4 is the legal rate supplied under MCL 438.31; MSA 19.15(1), and (3) that interest is governed by § 6013 from the date a complaint is filed requesting confirmation of an award and continues until the date judgment rendered on the award is satisfied.”
Lawsuit Fin., LLC v. Curry, 683 N.W.2d 233 (Mich. Ct. App. 2004).
· cites it 4× “§ 438.31, which establishes a maximum legal interest rate of seven percent, and M.”
Lawsuit Fin., LLC v. Curry, 261 Mich. App. 579 (Mich. Ct. App. 2004).
· cites it 4× “116(0(10) on the grounds that the transactions are usurious loans and that plaintiff is seeking annual interest rates ranging from 200 percent and 370 percent, contrary to MCL 438.31, which establishes a maximum legal interest rate of seven percent, and MCL 438.”
Souden v. Souden, 844 N.W.2d 151 (Mich. Ct. App. 2013).
· cites it 3× “However, this Court lacks sufficient information to determine whether the “finance charge” is interest on a debt or a late fee, and thus cannot determine if the charge is in violation of MCL 438.31. The issue whether state or federal usury laws apply to Russell’s claimed…”
Michigan Mobile Homeowners Ass'n v. Bank of the Commonwealth, 223 N.W.2d 725 (Mich. Ct. App. 1974).
· cites it 15× “Plaintiffs alleged that said mobile home sales contracts were *209 subject to the 7% interest provisions of the general usury law, MCLA 438.31; MSA 19.15(1), and that defendant financial institutions were charging and collecting interest on these contracts in excess of the…”
Yaldu v. Bank of Am. Corp., 700 F. Supp. 2d 832 (E.D. Mich. 2010).
· cites it 4× “, based on the defendants’ alleged deceit; (11) violation of the usury law, Mich. Comp. Laws § 438.31 et seq.; and (12) temporary restraining order/preliminary injunction count.”
Paul v. U.S. Mut. Fin. Corp., 389 N.W.2d 487 (Mich. Ct. App. 1986).
· cites it 4× “*780 The plaintiffs herein contend that the promissory note is in violation of MCL 438.31; MSA 19.15(1), which sets forth a 7% per annum ceiling on interest rates.”
Moultrie v. Detroit Auto. Inter-Ins. Exch., 333 N.W.2d 298 (Mich. Ct. App. 1983).
· cites it 4× “In the instant case the arbitration proceedings were instituted by a filing of a claim for arbitration with the insurance company not a complaint with the court. The pre-circuit court proceedings simply were not the equivalent of civil action, and therefore § 6013 does not…”
In Re Dow Corning Corp., 237 B.R. 380 (Bankr. E.D. Mich. 1999).
· cites it 2× “855 (loans made by the toxic substance loan commission accrue interest at 0% for the first 5 years, at 3% for the next 5 years, and at 2% less than the prime lending rate thereafter); Mich.Comp. Laws § 438.31 (Except for certain notes and bonds, the "legal interest rate .”
— Mich. Comp. Laws § 438.31(c) — 2 cases
— Mich. Comp. Laws § 438.31(c)(2) — 1 case
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