HF 2601 Minnesota House · 2025-2026 Regular Session

Maximum interest rate for certain loans and contracts for deed modified.

HF 2601 modifies Minnesota's maximum interest rate for conventional loans and contracts for deed (land contracts) used to purchase real estate. It sets the cap as the Wall Street Journal's published 30-year mortgage yield plus four percentage points, replacing the previous calculation method. This change directly affects borrowers and lenders in these specific loan types, particularly for cooperative apartment loans and land contracts. The bill amends Minnesota Statutes sections 47.20 (subd. 4a) and 334.01 (subd. 2) to implement this rate formula. It does not alter the existing 10-year loan exception (capping rates at 15.75% or 3% above the new rate).

Bill status in committee 1 of 4 stages cleared

Introduction

Mar 2025

Committee Review

Floor Vote

Governor

Introduced Mar 20, 2025 Last action Apr 1, 2025

Maddy AI version diff · 1 comparison

What changed between versions

Introduction → 1st Engrossment · 8 edits · Apr 1, 2025

MODERATE

This bill significantly expands Minnesota's insurance regulations to address risks within large insurance holding companies. It introduces new requirements for insurers to perform and file NAIC liquidity stress tests and group capital calculations, while also tightening rules on investments in subsidiaries and transactions between affiliated companies. The legislation adds strict confidentiality protections for these sensitive financial reports to prevent market manipulation or unfair competition.

Scope change

The bill's scope expanded from primarily regulating loan interest rates and general insurance transactions to specifically targeting the financial stability of large, complex insurance holding company systems operating across state and international borders.

REQUIREMENT

Added mandatory requirements for insurers to file annual group capital calculations and results from NAIC liquidity stress tests to assess enterprise risk.

Established new filing requirements for preacquisition notifications regarding the purchase of controlling interests in domestic insurers.

Created new rules for groupwide supervision of internationally active insurance groups, allowing the commissioner to act as a single supervisor for such entities.

Modified thresholds for transactions requiring commissioner approval, adjusting limits on investments, loans, and guarantees based on insurer size and type.

DEFINITION

Defined new terms including 'group capital calculation instructions,' 'NAIC liquidity stress test framework,' and 'scope criteria' to standardize how insurers are evaluated.

Added exemptions for small insurance holding companies and those with reciprocal international supervision from certain group capital filing requirements.

ELIGIBILITY

Modified investment authority rules to allow insurers to invest more in subsidiaries if certain financial conditions are met, while excluding health maintenance organizations from specific investment calculations.

ENFORCEMENT

Added provisions allowing the commissioner to require deposits or bonds from insurers in hazardous financial conditions to protect policyholders.

Floor votes

How they voted

No floor votes recorded yet.

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Apr 1, 2025

Lower · Passed

Committee report, to adopt as amended and re-refer to Judiciary Finance and Civil Law

lower

Mar 20, 2025

Introduced

Introduction and first reading, referred to Commerce Finance and Policy

lower

1 primary · 0 co-sponsors