MN SF3932

Minnesota declares it does not want federal amendments from the Depository Institutions Deregulation and Monetary Control Act of 1980 (Public Law 96-221) that prescribe interest rates and preempt state rates to apply to consumer loans made in Minnesota.

Consumer loans made in Minnesota are subject to state interest rate limits, not federal preemption, provided the borrower is a Minnesota resident and completes the transaction while physically located in Minnesota.

Financial institutions may charge a maximum annual percentage rate of 21.75 percent on loans, or alternatively 33 percent per year on the first $1,350 of unpaid principal and 19 percent per year on amounts exceeding $1,350.

Credit card finance charges are capped at 18 percent per year, or higher if the financial institution is an out-of-state bank or credit union allowed by their home state to charge more.

The bill takes effect August 1, 2024, and applies to loans executed on or after that date.