Title Loans: Regulations by State
Title loans are short-term loans that use the borrower's car as collateral. The borrower typically receives the loan amount in cash, and the lender keeps the title to the car until the loan is repaid. Title loans are often associated with high interest rates and fees, and they can be risky for borrowers.
Regulations on title loans vary by state. In some states, title loans are prohibited altogether. In other states, title loans are allowed, but they are subject to various regulations, such as limits on interest rates and fees, and requirements for lenders to disclose certain information to borrowers.
The following table provides a summary of title loan regulations by state:
| State | Title loans permitted? | Interest rate cap | Other regulations |
|---|---|---|---|
| Alabama | Yes | No | - |
| Alaska | No | - | - |
| Arizona | Yes | No | - |
| Arkansas | Yes | 17% APR | - |
| California | Yes | 291% APR | - |
| Colorado | Yes | 45% APR | - |
| Connecticut | No | - | - |
| Delaware | Yes | No | - |
| District of Columbia | No | - | - |
| Florida | Yes | 30% APR | - |
| Georgia | Yes | No | - |
| Hawaii | Yes | 36% APR | - |
| Idaho | Yes | No | - |
| Illinois | Yes | No | - |
| Indiana | Yes | 36% APR | - |
| Iowa | Yes | 21% APR | - |
| Kansas | Yes | No | - |
| Kentucky | Yes | 36% APR | - |
| Louisiana | Yes | 18% APR | - |
| Maine | Yes | 18% APR | - |
| Maryland | Yes | 36% APR | - |
| Massachusetts | Yes | 21% APR | - |
| Michigan | Yes | 36% APR | - |
| Minnesota | Yes | 36% APR | - |
| Mississippi | Yes | No | - |
| Missouri | Yes | No | - |
| Montana | Yes | 36% APR | - |
| Nebraska | Yes | 36% APR | - |
| Nevada | Yes | No | - |
| New Hampshire | Yes | No | - |
| New Jersey | Yes | 36% APR | - |
| New Mexico | Yes | No | - |
| New York | Yes | 24% APR | - |
| North Carolina | Yes | 36% APR | - |
| North Dakota | Yes | 36% APR | - |
| Ohio | Yes | 36% APR | - |
| Oklahoma | Yes | No | - |
| Oregon | No | - | - |
| Pennsylvania | Yes | 36% APR | - |
| Rhode Island | Yes | 12% APR | - |
| South Carolina | Yes | 36% APR | - |
| South Dakota | Yes | No | - |
| Tennessee | Yes | No | - |
| Texas | Yes | No | - |
| Utah | Yes | No | - |
| Vermont | Yes | 36% APR | - |
| Virginia | Yes | No | - |
| Washington | No | - | - |
| West Virginia | Yes | 36% APR | - |
| Wisconsin | Yes | No | - |
| Wyoming | Yes | 42% APR | - |
It is important to note that state laws on title loans can change frequently. It is always best to check with your state's consumer protection agency or attorney general's office to learn about the latest regulations before taking out a title loan.
If you are considering taking out a title loan, it is important to be aware of the risks involved. Title loans can be very expensive, and they can put your car at risk of being repossessed. It is important to compare offers from multiple lenders and to carefully read the loan terms before signing anything.
If you are unable to repay a title loan, you may be able to negotiate a payment plan with the lender. You may also be able to sell your car privately to pay off the loan. However, if you default on the loan, the lender may repossess your car and sell it to pay off the debt.
If you are struggling to make ends meet, there may be other resources available to help you. You may be eligible for government assistance programs, or you may be able to get help from a non-profit organization