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Loan rates and rules in Texas
Who regulates Texas lenders, how each type of loan is priced, which West Texas cities limit payday and title loans, and what the numbers look like.
Who regulates loans in Texas
The Office of Consumer Credit Commissioner (OCCC) licenses and examines most non-bank lenders in Texas: consumer installment lenders, credit access businesses that arrange payday and title loans, pawnshops and others. Banks are supervised by the Texas Department of Banking or federal regulators, and credit unions by the Texas Credit Union Department or the NCUA. If a lender is not a bank or credit union, look it up in the OCCC license search before you borrow.
Contact: OCCC, 2601 N. Lamar Blvd., Austin, TX 78705, (800) 538-1579, occc.texas.gov.
The main loan types and their price rules
| Loan type | Texas law | How it is priced |
|---|---|---|
| Consumer installment loan | Finance Code Ch. 342, Subchapter E | Interest up to state-set brackets plus a limited administrative fee |
| Small cash-advance installment loan | Ch. 342, Subchapter F | Acquisition charge plus monthly installment account handling charge; maximum loan size adjusted yearly |
| Payday loan | Ch. 393 credit access business arranges it from a third-party lender | Lender interest plus CAB fees; fees not capped by the state |
| Auto title loan | Ch. 393, as above | Same as payday; secured by your vehicle |
| Bank or credit union loan | State and federal banking law | APR set by the institution; federal credit union PALs max 28% |
Chapter 342 amounts for loans made July 1, 2026 – June 30, 2027
The OCCC adjusts these dollar figures every year. They are legal ceilings and bracket breakpoints, not the amount any lender will offer you.
| Provision | Adjusted amount | What it means |
|---|---|---|
| §342.251 (Subchapter F) | $920 | Standard maximum cash advance for a small loan |
| §342.259 (Subchapter F) | $1,840 | Ceiling for the larger small-loan category with its own charges |
| §342.252(b) (Subchapter F) | $130 | Maximum acquisition charge |
| §342.201(g) (Subchapter E) | $130 | Maximum administrative fee |
| §342.201(a) (Subchapter E) | $2,760 and $23,000 | Breakpoints between interest tiers |
| §342.201(e) (Subchapter E) | $4,600, $9,660 and $23,000 | Breakpoints for the alternative 30% / 24% / 18% rate structure |
Source: Texas Register, February 13, 2026, OCCC rate bracket adjustments; statute: Texas Finance Code Chapter 342.
City rules for payday and title loans
Because the state does not cap credit access business fees, dozens of Texas cities have adopted a common ordinance (Texas Appleseed counted 46 in 2021). In West Texas, Midland (City Code Chapter 5-11), El Paso (Chapter 5.17) and Amarillo (Chapter 14-10) regulate these businesses. Midland’s chapter, for example, says:
- A payday loan’s cash advance cannot exceed 20% of your gross monthly income.
- A title loan’s cash advance cannot exceed the lesser of 3% of your gross annual income or 70% of the vehicle’s retail value.
- An installment payday or title loan can have no more than four installments, each paying down at least 25% of the principal.
- A single-payment loan can be renewed no more than three times, each renewal paying down at least 25% of the original principal.
Amarillo applies the same income and vehicle-value limits. El Paso licenses credit access businesses and limits where they can open; check its Chapter 5.17 for the loan terms that apply to your transaction. These city rules cover payday and title loans arranged in that city, not bank, credit union or finance-company installment loans. We did not find a comparable ordinance in force in Lubbock or Odessa at our last review; Lubbock’s city council voted one down in January 2017. Our Midland page has a calculator for the city limits.
Representative examples
Illustrations of how APR and term change the cost. Not offers.
| Loan | APR | Term | Monthly payment | Total of payments | Cost of credit |
|---|---|---|---|---|---|
| $1,200 credit union PAL II, no application fee | 28% | 12 months | $115.81 | $1,389.69 | $189.69 |
| $2,000 online installment | 35.99% | 24 months | $118.08 | $2,834.02 | $834.02 |
| $5,000 personal loan | 18% | 36 months | $180.76 | $6,507.43 | $1,507.43 |
| $1,000 high-cost installment | 160% | 6 months | $252.48 | $1,514.88 | $514.88 |
| $3,000 bad-credit installment | 99% | 24 months | $290.90 | $6,981.56 | $3,981.56 |
- Total of payments
- Total interest cost
What every lender must show you
- Truth in Lending disclosure: APR, finance charge, amount financed and total of payments, before you sign.
- Credit access business disclosure for payday and title loans, comparing the cost of the loan if repaid on time and if renewed.
- The OCCC notice telling you where to send complaints, posted in licensed locations and in the loan papers.
Keep copies of everything you sign. If something does not match what you were told, contact the lender first, then the OCCC.
See what lenders can offer you
One online request, about five minutes. Checking your options is free, and you decide whether to accept any offer.
Questions people ask
Is there an interest rate cap in Texas?
For lenders licensed under Chapter 342 the Finance Code sets maximum charges, which differ by loan size and type. Credit access businesses that arrange payday and title loans charge fees that the state does not cap, which is why those loans are the most expensive. Cities such as Midland and Amarillo limit the size of those loans and, in Midland, the number of installments and renewals; they do not cap the fee.
How do I check whether a lender is licensed in Texas?
Use the license search on the OCCC website, occc.texas.gov. Consumer lenders, credit access businesses, pawnshops and motor vehicle sales finance companies all appear there. Banks and credit unions are chartered by other regulators.
What does APR include?
The annual percentage rate shows the yearly cost of credit, including interest and most required fees such as an acquisition or origination fee. It lets you compare loans of different sizes and lengths on the same footing.
What protections do military borrowers have?
The Military Lending Act caps the Military APR at 36% for most consumer credit to active-duty service members and covered dependents, bans mandatory arbitration and stops lenders from requiring a military allotment. Fort Bliss, Dyess AFB and Goodfellow AFB legal offices offer free help.