An Act amending the act of January 30, 1974 (P.L.13, No.6), referred to as the Loan Interest and Protection Law, in protective provisions, further providing for prepayment penalty prohibited.

PRINTER'S NO. 3211
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 2391
Session of
2026
INTRODUCED BY CONKLIN, HARKINS, HILL-EVANS, GUZMAN AND PARKER,
APRIL 15, 2026
REFERRED TO COMMITTEE ON COMMERCE, APRIL 16, 2026
AN ACT
Amending the act of January 30, 1974 (P.L.13, No.6), entitled
"An act regulating agreements for the loan or use of money;
establishing a maximum lawful interest rate in the
Commonwealth; providing for a legal rate of interest;
detailing exceptions to the maximum lawful interest rate for
residential mortgages and for any loans in the principal
amount of more than fifty thousand dollars and Federally
insured or guaranteed loans and unsecured, noncollateralized
loans in excess of thirty-five thousand dollars and business
loans in excess of ten thousand dollars; providing
protections to debtors to whom loans are made including the
provision for disclosure of facts relevant to the making of
residential mortgages, providing for notice of intention to
foreclose and establishment of a right to cure defaults on
residential mortgage obligations, provision for the payment
of attorney's fees with regard to residential mortgage
obligations and providing for certain interest rates by banks
and bank and trust companies; clarifying the substantive law
on the filing of and execution on a confessed judgment;
prohibiting waiver of provisions of this act, specifying
powers and duties of the Secretary of Banking, and
establishing remedies and providing penalties for violations
of this act," in protective provisions, further providing for
prepayment penalty prohibited.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 405 of the act of January 30, 1974
(P.L.13, No.6), referred to as the Loan Interest and Protection
Law, is amended to read:
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Section 405. Prepayment Penalty Prohibited.--Residential
mortgage obligations made primarily for personal, family or
household purposes and contracted for on or after the effective
date of this act may be prepaid without any penalty or other
charge for such prepayment at any time before the end of the
period of the loan.
Section 2. This act shall take effect in 60 days.
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