WeVote
Log In

Bill

Bill

HB 6198

Financial institutions: mortgage brokers and lenders; consolidation of certain licensing statutes related to residential mortgages; make conforming changes in RS 1846 ch 81. Amends sec. 2 of 1846 RS 81 (MCL 566.132). TIE BAR WITH: HB 6177'26

2025-2026 Regular Session Introduced by Parker Fairbairn and 1 co-sponsor

HB 6198 requires financial institutions to make lending and credit commitments in writing and signed to be enforceable, expanding the statute of frauds for banks, credit unions, an

bill electronically reproduced 07/03/2026
#financialinstitutions:mortgagebrokersandlenders
0
WeVote Research Nonpartisan
Bill Summary · HB 6198

Bill Overview

  • Bill: HB 6198
  • Session: 2025-2026 (Michigan)
  • Introduced: July 3, 2026 by Reps. Fairbairn and Tisdel; referred to the Committee on Finance
  • Purpose: Amend the Michigan statute governing certain contracts and writing requirements, with a tie Bar to HB 6177. The bill focuses on converting certain lending-related activities of financial institutions into written-and-signed commitments to enhance enforceability and alignment with the statute of frauds.

What the bill would do

  • Main objective: Clarify and extend the statute of frauds to cover written and signed obligations of financial institutions in specified scenarios, and to consolidate licensing-related provisions across residential mortgage licensing statutes.
  • Key changes include:
    • Reinforces that certain agreements must be in writing and signed to be enforceable, including:
    • Agreements not to be performed within one year.
    • Special promises to answer for another’s debt, default, or misdoings.
    • Promises related to marriage considerations (except mutual promises to marry).
    • Special promises by personal representatives to answer damages from their own estate.
    • Contracts to pay a commission for the sale of real estate interests.
    • Assignments of things in action (transfer for sale, security, or other purposes).
    • Warranties or promises of cure related to medical care or treatment (noting malpractice/negligence rights remain).
    • Specifically for financial institutions, requires written and signed promises or commitments in the following areas:
    • Promises or commitments to lend money, grant or extend credit, or provide other financial accommodations.
    • Promises or commitments to renew, extend, modify, or delay repayment or performance of a loan or credit.
    • Promises or commitments to waive provisions of a loan or other financial arrangements.
    • In broad terms, these provisions apply to:
    • Banks (state or national chartered).
    • Savings banks or savings and loan associations (state or federal).
    • Credit unions (state or federal).
    • Transitional provisions related to licensing:
    • For six months after the effective date of the Residential Mortgage Licensing and Supervision Act, the above financial-institution definitions include those licensed or registered under the Mortgage Brokers, Lenders, and Servicers Licensing Act (1987 PA 173) or the Secondary Mortgage Loan Act (1981 PA 125) or their affiliates/subsidiaries.
    • Beginning on the effective date of the Residential Mortgage Licensing and Supervision Act, the definition includes persons licensed under that act or affiliates/subsidiaries thereof.

Administrative and structural notes

  • Tie Bar: The bill is tied to HB 6177 (as part of a package of licensing and regulatory changes related to residential mortgages). The enactment of HB 6198 is contingent on HB 6177 being enacted into law.
  • Effective date mechanics: The bill provides staged applicability:
    • Six-month post-enactment window for certain mortgage-licensing stand-ins (affiliates/subsidiaries of a licensed person).
    • Full incorporation once the Residential Mortgage Licensing and Supervision Act takes effect.

Who Would be Affected

  • Financial institutions subject to the statute of frauds and licensing regimes:
    • State and national banks.
    • State and federal savings banks or savings and loan associations.
    • State and federal credit unions.
    • Mortgage brokers, lenders, and servicers (and their affiliates/subsidiaries) during transitional six-month period.
    • Parties dealing with real estate-related transactions where such institutions issue promises to lend, extend credit, modify terms, or waive provisions.
  • Consumers and real estate participants: Indirectly affected through clearer, written commitments from financial institutions, potentially reducing disputes over enforceability of lending commitments.

Key Provisions and Provisions Scope

  • Statute of Frauds alignment: Expands or clarifies the requirement that certain financial commitments be in writing and signed to be enforceable.
  • Scope of financial commitments covered: Lenders’ promises to lend, extend credit, renew or modify terms, or waive terms.
  • Scope of institutions covered: Banks, savings institutions, and credit unions; plus mortgage-licensing entities during transitional periods.
  • Conforming changes: Aligns with broader regulatory consolidation in residential mortgage licensing statutes and related acts.

Timeline and Procedural Aspects

  • Intro/update dates: Introduced July 3, 2026; awaiting committee action in Finance.
  • Effective date mechanics: Not explicitly stated in the text; depends on the enactment of HB 6177 for the overall effect. Six-month transitional provision for licensees under mortgage broker/lender acts after the residential mortgage licensing act’s effective date.
  • Enactment condition: The act does not take effect unless HB 6177 is enacted.

Potential Impact

  • Legal clarity and enforceability: Strengthens enforceability requirements for financial commitments, potentially reducing disputes over informal or oral promises by financial institutions.
  • Regulatory alignment: Moves toward consolidation of licensing statutes related to residential mortgages, potentially simplifying regulatory oversight and compliance for lenders, brokers, and servicers.
  • Transitional considerations: The six-month window provides a runway for entities currently operating under older licensing regimes to adjust to new requirements.

If you’d like, I can compare this bill’s text to the related HB 6177 provisions or provide a side-by-side summary of differences between current law and HB 6198.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.