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Texas · checked October 24, 2026

Payday loans in Texas: the rules and your way out

Payday loans allowed, with limits

Texas payday loans are mostly made through licensed credit access businesses (CABs) that arrange loans from unlicensed third-party lenders and charge broker fees that state law does not cap; several cities add their own limits.

Law: Tex. Fin. Code ch. 393, subch. C-1 (§§ 393.221-.224) and subch. G (§§ 393.601-.628); § 393.201-.202; § 341.001(6); § 302.001; 7 Tex. Admin. Code ch. 83. Texas Finance Code as published by the Texas Legislative Council, accessed 2026-10-24 (latest amendments seen in ch. 393: 2023, 88th Leg.).

Texas's rules, line by line

Largest loan
No state statutory maximum for CAB-arranged loans found in Fin. Code ch. 393. City ordinances can limit it: e.g., Houston caps payday loans at 20% of the consumer's gross monthly income (Houston Code ch. 28, art. XV).
Fee or rate cap
A CAB 'may assess fees for its services as agreed to between the parties' (Tex. Fin. Code § 393.602(b)), and the Finance Commission and OCCC have no authority to limit CAB fees (§ 393.622(c)). The third-party lender's interest is generally limited by the 10% a year usury ceiling 'except as otherwise provided by law' (§ 302.001(b)).
Renewals and rollovers
No state limit found in ch. 393; the CAB must post a notice that refinancing instead of paying in full costs additional charges (§ 393.222(a)(3)). Houston: lump-sum loans may not be refinanced or renewed more than three times; installment loans may not be refinanced or renewed (city ordinance).
Waiting period between loans
No state rule found. Houston treats a new loan within 7 days after a prior one is paid as a refinancing or renewal.
Payment plan if you cannot pay
No state-law extended payment plan found in Fin. Code ch. 393. (Houston limits installment repayment to no more than four installments.)
State loan database
No.
Limits on collection
CAB contracts must state that no one may threaten or pursue criminal charges over a check or debit authorization given as security, absent forgery, fraud, theft or other criminal conduct (§ 393.201(c)(3)). The CAB must follow Texas debt collection law (Fin. Code ch. 392) and the federal FDCPA (§§ 393.201(c)(2), 393.626).
Other rights
CAB contract must state there is no prepayment penalty and disclose the lender, the lender's interest, and the CAB's fees (§ 393.201(c)). Credit services organization contracts must include a notice that the buyer may cancel before midnight of the third day after the transaction (§ 393.202). CABs must be licensed and post fee schedules and the OCCC helpline (§§ 393.222, 393.623).

If you are behind on a payday loan in Texas

  1. Stop the automatic withdrawals if they are emptying your account. You can revoke the lender's permission to debit your account and tell your bank. How to do it.
  2. Look at a credit union payday alternative loan. Federal credit unions can lend $200 to $2,000 at much lower cost. How they work.
  3. Talk to a nonprofit credit counselor. A counselor can look at all your bills, not just this one. How to find a real one.

Check a lender, or report one

Sources

This page summarizes the law; it is not legal advice. Laws change, and the statute and regulator control. If something here is out of date, write to hello@paydayloan.help.

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