Michigan maximum interest rate is the answer to “maximum interest rate allowed by law in Michigan”. This guide gives the Michigan figures in a dated table, explains in plain words what they mean, walks through the steps, and points to the official forms and free help.
The Michigan maximum interest rate figures on this page were verified against a dated 50-state compilation and Michigan sources as of October 2026; the statute named here is where to check them yourself.
Michigan maximum interest rate at a Glance
| Legal rate when no rate is agreed | 5% per year |
| Maximum rate in a written contract | 7% per year with a written agreement |
| Criminal usury threshold | above 25% per year is criminal usury |
| Statute | MCL 438.31, 438.41 |
In This Michigan maximum interest rate Guide:
What the Michigan Maximum Interest Rate Means
Usury means charging more interest than Michigan law allows. Michigan has two separate limits. The legal rate is the default that applies when the parties never agreed on a rate. The contract cap is the highest rate a lender may charge under the state’s general interest law, and it only applies when the rate is agreed in writing. A separate, higher line makes knowingly charging interest above it a crime.
The Michigan maximum interest rate Figures
| Rule | Bonus Bank Daily verified figure |
|---|---|
| Legal rate when no rate is agreed | 5% per yearcompilation / agency — verified Oct 2026 |
| Maximum rate in a written contract | 7% per year with a written agreementcompilation / agency — verified Oct 2026 |
| Criminal usury threshold | above 25% per year is criminal usurycompilation / agency — verified Oct 2026 |
| Statute | MCL 438.31, 438.41compilation / agency — verified Oct 2026 |
The Michigan maximum interest rate figures on this page were verified against a dated 50-state compilation and Michigan sources as of October 2026; the statute named here is where to check them yourself.
Who the Michigan Maximum Interest Rate Applies To
The general cap covers ordinary loans and credit sales between private parties and lenders who have no special license. Licensed lenders, such as consumer finance companies under the Regulatory Loan Act, mortgage lenders and credit unions, can usually charge the higher rates set by their own licensing laws. Banks chartered in other states and national banks generally follow federal rules and their home-state limits, not Michigan’s cap.
Under MCL 438.61, business entities may generally agree to any rate in writing, so most business loans fall outside the cap.
Credit Cards and the Michigan Maximum Interest Rate
Federal banking law lets a national bank charge the interest rate allowed in the state where it is based, even to customers living in Michigan. Many card issuers are based in states with high or no rate limits, so card rates above Michigan’s cap are usually legal. State-chartered banks from other states generally have the same right under federal law.
What Happens When a Lender Breaks the Michigan Maximum Interest Rate
Under MCL 438.32, a lender or seller whose contract breaks the interest law generally cannot recover any interest, official fees, delinquency or collection charges, attorney fees or court costs. The borrower may recover their own attorney fees and court costs from the lender. The Michigan Supreme Court has held that a “savings clause” does not protect a note that requires a usurious rate on its face.
Criminal usury is a felony carrying up to 5 years in prison, a fine of up to $10,000, or both. Lenders that state or federal law authorizes to charge more are exempt.
How to Check a Loan Against the Michigan Maximum Interest Rate
1) Find the APR or stated interest rate in your loan papers or Truth in Lending disclosure. 2) Find out who the lender is and whether DIFS licenses it, because licensed lenders follow different limits. 3) Check whether the rate was agreed in writing. 4) Compare the yearly simple-interest rate, counting any fees treated as interest, with the limit that applies.
5) Confirm with the statute, the court clerk or an attorney.
Where to Report a Loan Above the Michigan Maximum Interest Rate
The Michigan Department of Insurance and Financial Services (DIFS) licenses consumer lenders and takes complaints online at michigan.gov/DIFScomplaints or by phone at 877-999-6442. DIFS says it does not settle private contract disputes, which go to civil court. You can also file a complaint with the federal Consumer Financial Protection Bureau at consumerfinance.gov/complaint.
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Common Mistakes With Michigan maximum interest rate
The most common mistake is missing a deadline: court and creditor deadlines run whether or not you have read the papers, and a missed one usually cannot be undone. The second is relying on an old article or a friend’s experience in another state — the rules on this page differ from state to state and change often, which is why every figure here is dated.
The third is not keeping copies: every letter, form, receipt and bank statement may matter later, so keep them together and note the date you received each one.
Free Help With Michigan maximum interest rate in Michigan
You do not have to handle this alone or pay to get answers. The Michigan court self-help center explains the forms and the steps, and court clerks can tell you where and how to file, although they cannot give legal advice.
Legal aid organizations represent many people at no cost when income is limited, and the Michigan bar’s lawyer referral service can connect you with a lawyer for a low-cost first consultation. The Consumer Financial Protection Bureau accepts complaints about lenders, banks and debt collectors nationwide.
How We Verify the Michigan maximum interest rate Figures
Every figure in the table above comes from our 50-state data file, built by reading the Michigan statute or an official compilation of it, and each one carries the month we last checked it. Our writers do not change those figures; they explain them. When the law changes, the figure is updated and the date moves.
If something on this page no longer matches the statute, the statute controls — and we want to hear about it.
Under MCL 438.42, simply holding records of criminally usurious loans is a separate crime, with up to 1 year in prison, a fine of up to $1,000, or both.
Next rung: the Michigan payday loan page covers the short-term loans that have their own caps.
Michigan — the bottom line
- Michigan maximum interest rate rules set two numbers — the legal rate and the written-contract cap — both in the table above.
- Many lenders sit outside the Michigan maximum interest rate cap by license or charter, so check which rule covers your loan.
- If a loan breaks the Michigan maximum interest rate rules, keep the agreement and report it to the state regulator.
Michigan Maximum Interest Rate FAQ
What is the maximum interest rate allowed by law in Michigan?
Without an agreement: 5% per year. In a written contract: 7% per year with a written agreement.
Is there a criminal usury law in Michigan?
above 25% per year is criminal usury
Official Michigan Sources & Resources
- Statute and the Conference of State Bank Supervisors 50-state usury survey (verified by each state regulator) — maximum legal interest rate: https://www.csbs.org/50-state-survey-consumer-finance-laws
- Statute and the Conference of State Bank Supervisors 50-state usury survey (verified by each state regulator) — maximum legal interest rate: https://facts.csbs.org/consumer-finance-law/dev
- Michigan statute / opinion: https://capitol.legislature.mi.gov/documents/mcl/pdf/MCL-438-32.pdf
- Michigan Department of Insurance and Financial Services (DIFS), Office of Consumer Services: https://www.michigan.gov/difs/consumers/complaint/file-a-paper-complaint
- Consumer Financial Protection Bureau: consumerfinance.gov
This Michigan maximum interest rate guide was last verified against official Michigan sources in October 2026. Rules change — confirm the current rule with the statute or a licensed attorney.
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Disclaimer: This guide is general information, not legal or financial advice. Bonus Bank Daily is an independent educational resource — not a law firm, not a bank, not a debt collector and not a government agency. Judgment, levy, interest-rate and debt rules change — every figure here carries the date we verified it.
Confirm the current rule with the statute, the court clerk or a licensed attorney in your state before you act.