Most states have usury laws (usually statutes) governing the amount of interest that can be charged on a loan. Usury laws vary from state to state, but the elements of a usury claim are generally: (1) a loan of money; (2) an absolute obligation to repay the principal; and (3) the exaction of a greater compensation than allowed by law for the use of the money by the borrower.

And interest means compensation for the use, forbearance, or detention of money. The term does not include time price differential, regardless of how it is denominated. The term does not include compensation or other amounts that are determined or stated by law not to constitute interest, or that are permitted to be contracted for, charged, or received in addition to interest in connection with an extension of credit.

Service charges, finance charges, and discount points are generally considered interest for purposes of usury. But contingent or uncertain charges are generally not considered interest.

In Michigan, usury laws are codified under the Michigan Compiled Laws (MCL). These laws set the maximum legal interest rates that can be charged on loans. As of the current regulations, the legal maximum rate of interest for a loan that does not exceed $100,000 is 7% per annum if not agreed upon in writing. If the loan agreement is in writing, parties may agree to a higher rate of interest, which cannot exceed 25% per annum. For loans exceeding $100,000, there is no statutory interest rate limit, and the parties are free to negotiate the rate. The elements of a usury claim in Michigan include the existence of a loan of money, an absolute obligation to repay the principal, and the charging of an interest rate exceeding the legal limit. Charges that are considered interest include service charges, finance charges, and discount points. However, contingent or uncertain charges are typically not regarded as interest. It's important to note that certain types of loans, such as those related to mortgages, banking, and credit cards, may be subject to different regulations and exceptions.