Overhaulin'

What is the maximum legal interest rate for a car loan?"?

I was wondering what the LEGAL Max. interest rate for a car loan in the state of Texas is and how does it compare to other states? I have heard it is 18% but I am unsure.

Public Comments

1. Each state has usury laws regarding interest rates. TEXAS, the legal rate of interest is 6%. Interest does not begin until 30 days after an account was due. The judgment rate of interest is 18% or the rate in the contract, whichever is less. There are a number of specific ceilings for different types of loans, please see counsel for information. That being said, banks have separate rules. In fact, due to high inflation, in 1980, the federal government passed a special law which allowed national banks (the ones that have the word "national" or the term "N.A." in their name, and savings banks that are federally chartered) to ignore state usury limits and pegged the rate of interest at a certain number of points above the federal reserve discount rate. In addition, specially chartered organizations like small loan companies and installment plan sellers (like car financing companies) have their own rules.
2. Your right, in Texas it's 18%. It varies by State, like in Oklahoma it's 21% and in Iowa it's 27%. A website I've recommended in the past would be... http://www.safelinked.info/go.php?link=auto Good luck