Loan Rates and Fees in Michigan

A licensed lender can charge a tiered service fee: 15% of the first $100, 14% of the second $100, 13% of the third $100, 12% of the fourth $100, and 11% of the fifth and sixth $100. Your loan can't exceed $600, tracked through a statewide database. Terms run up to 31 days.

On a $300 loan due in 14 days, the maximum service fee is $42 ($15 + $14 + $13), making your total repayment $342. Federal disclosure rules require your agreement to show the APR - on a 14-day $300 loan that works out to roughly 365% APR, because the short term scales the fee to an annual rate.

• Rollovers are prohibited - a lender can't renew or extend a payday loan, and no repayment period can exceed 31 days from the date of the loan.
• The returned payment fee is CPI-adjusted and set by statute - verify the current amount with DIFS before you sign.
• A database verification fee may appear as a separate line item - verify the current cap with DIFS if the amount seems high.

If an offer exceeds these limits, verify with the Michigan Department of Insurance and Financial Services (DIFS).

Licensed lenders under Michigan's Regulatory Loan Act use a declining-balance (simple interest) model - interest is computed only on the unpaid principal balance. The rate cap under the Credit Reform Act is 25% per annum on the outstanding balance.

A loan processing fee of up to 5% of the principal (maximum $250, adjusted periodically for inflation) may be charged on closed-end loans and can be rolled into the loan principal.

On a $1,000 loan at 25% annually for 12 months, you'd repay approximately $1,137 total - roughly $137 in interest plus $1,000 in principal. Your actual total depends on payment timing and how quickly the balance declines.

• Refinancing restarts interest on the new amount - compare your remaining balance to the new loan's total of payments before you agree.
• The same CPI-adjusted returned payment fee applies - see payday loan costs above.
• Late fees are governed by the Credit Reform Act - ask the lender for the exact grace period and amount before you sign.
• You can prepay in full at any time with no penalty - interest stops accruing on the date you pay; see the Michigan installment loans page for repayment details.

If an offer exceeds these limits, verify with DIFS.

• Returned payment fee: set by statute and adjusted for inflation - confirm the current cap with DIFS on either product.
• Total of payments: add every payment on the schedule and confirm it matches the "total of payments" line on your agreement.
• Military households: if you or your spouse are active-duty, the all-in cost can't exceed 36% MAPR under federal law - compare to the APR on the offer.