Michigan House Bill HB5362

Michigan 2023-2024 Regular Session

• Introduced: 11/14/23
• Refer: 11/14/23
• Refer: 1/10/24
• Report Pass: 5/23/24

Caption

Consumer protection: other; citations to the motor vehicle sales finance act in the credit reform act; revise. Amends secs. 2 & 5 of 1995 PA 162 (MCL 445.1852 & 445.1855). TIE BAR WITH: HB 5354'23

Impact

The impact of HB 5362 on state laws is significant, as it seeks to impose stricter regulations on financial institutions regarding the fees and lending practices allowed under existing law. The bill specifically addresses issues of excessive fees and aims to establish clearer guidelines to prevent lenders from charging consumers beyond what is permissible under the current statutes. This update could create a more equitable lending environment and reduce financial burdens on vulnerable borrowers.

Summary

House Bill 5362 proposes amendments to the 1995 PA 162, also known as the Credit Reform Act. The bill aims to clarify and revise definitions concerning various types of credit arrangements and the roles of regulated lenders. Specifically, it amends sections 2 and 5 to include clearer terms for 'borrower', 'credit card arrangement', and 'credit sale', and to delineate the responsibilities of financial institutions in relation to lending practices. These adjustments are intended to enhance consumer protections and ensure that borrowers are better informed about the terms of their credit agreements.

Contention

One notable point of contention surrounding HB 5362 is the potential pushback from regulated lenders who may view these amendments as overly restrictive or detrimental to their business operations. Proponents of the bill, however, argue that stronger consumer protections are necessary in an evolving financial landscape, where borrowers often face complex lending arrangements. There is a clear divide in perspectives regarding the balance between facilitating lending and protecting consumers from predatory practices, which may lead to continued debates as the bill moves through the legislative process.