RESTRICT LOAN REFERRAL FEES

Senate Bill 238 as passed by the Senate

Sponsor:  Sen. Darwin L. Booher

House Committee:  Financial Services

Senate Committee:  Banking and Financial Services

Complete to 10-17-17

SUMMARY:

Senate Bill 238 would amend the Regulatory Loan Act to prohibit a licensee from paying someone a fee for locating a potential borrower for or introducing or referring a potential borrow to the licensee unless both of the following:

·         The potential borrower is not directly or indirectly charged for all or any part of the fee if he or she entered into a loan with the licensee, and

·         The fee does not exceed $500. 

Currently, the Regulatory Loan Act prohibits a licensee from advertising any false, misleading, or deceptive statements regarding rates, terms or conditions for lending money, credit, or goods.  The Act also prohibits a person from making loans and charging a greater rate of interest, or consideration than the lender would be allowed to charge if it were not licensed under the Act. 

MCL 493.12

FISCAL IMPACT:

Senate Bill 238 would not have a fiscal impact on any units of state or local government.

                                                                                        Legislative Analyst:   E. Best

                                                                                                Fiscal Analyst:   Marcus Coffin

■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their deliberations, and does not constitute an official statement of legislative intent.