328.226 Prepaid funeral contract not in writing as voidable; agreement as to rate of interest; interest added or deducted in advance; computation of interest; financing o

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328.226 Prepaid funeral contract not in writing as voidable; agreement as to rate of interest; interest added or deducted in advance; computation of interest; financing of contract.

Sec. 16.

(1)A prepaid contract that is not in writing is voidable by any party to the prepaid contract.

(2)A prepaid contract made in violation of this act or with a person who is not registered pursuant to section 6 is voidable by the contract buyer or by a personal representative of the contract beneficiary.

(3)The parties to a prepaid contract may agree in writing for the payment of a rate of interest not to exceed 10.5% per annum with the following conditions:

(a)A prepaid contract made under this act shall not provide for a rate of interest added or deducted in advance. Interest shall be computed from time to time only on the basis of unpaid balances.

(b)A prepaid contract made under this act shall not provide that the rate of interest initially effective may be increased for any reason.

(c)A contract seller shall not impose any fees or charges in addition to interest in connection with the financing of a prepaid contract.

(4)A contract seller shall not offer financing or offer to obtain financing of a prepaid contract under terms and conditions other than allowed by this section.

History: 1986, Act 255, Eff. July 1, 1987 ;-- Am. 2004, Act 21 , Eff. Jan. 1, 2005

Compiler's Notes: For transfer of powers and duties of certain occupational functions, boards, and commissions from the Department of Licensing and Regulation to the Department of Commerce, see E.R.O. No. 1991-9, compiled at MCL 338.3501 of the Michigan Compiled Laws.