Payday Loans in Texas: Laws, Costs, and Your Options (2026)

Payday loans in Texas are legal, widely available, and, by the state’s own numbers, more expensive than in almost any other state. Texas caps interest but not the broker fee that carries most of the price, so a two-week loan routinely lands near 400% APR. This page covers what Texas law allows, what a loan actually costs, the rights you have before you sign, and which of the lenders we review serve Texas. For the deeper cost breakdown, read what a payday loan costs in Texas; for how Texas compares to every other state, see payday loan laws by state.

Texas payday loan rules at a glance

Rule	Texas
Legal status	Permitted, through a licensed Credit Access Business (Texas Finance Code, Chapter 393)
Regulator	Office of Consumer Credit Commissioner (OCCC), helpline (800) 538-1579
Who lends the money	A third-party lender named in your contract; the storefront or website is the broker
Cap on the broker’s fee	None at the state level (Finance Code §393.622(c))
Cap on the lender’s interest	The state’s default ceiling is 10% a year unless another law allows more (Finance Code §302.001)
Maximum loan amount	None in state law; some cities cap it as a share of monthly income
Rollover or refinance limit	None in state law; some cities limit refinances and require principal paydown
Required before you sign	A state-prescribed cost-comparison disclosure (Finance Code §393.223)
Required warning	Posted notice that the loan “is not intended to meet long-term financial needs” (Finance Code §393.222)
Military borrowers	36% federal MAPR cap under the Military Lending Act

How a Texas payday loan is structured

In most states, the company you borrow from is the lender. In Texas it usually is not. Storefront and online payday operators register as a Credit Access Business (CAB) under Chapter 393 of the Texas Finance Code. The CAB arranges a loan from a separate third-party lender, then charges its own fee for arranging and servicing it. The OCCC licenses the CAB; the third-party lender behind it is not the licensee.

That split is the whole story of Texas pricing. The lender’s interest sits inside the state’s ceiling. The CAB fee does not, because §393.622(c) says in so many words that nothing in the subchapter gives the Finance Commission or the OCCC authority to set a limit on the fees a CAB charges. Neither charge is hidden: the lenders say it plainly in their Texas disclosures, and your contract must name the third-party lender. Our Texas cost guide walks through the two charges line by line.

What a payday loan costs in Texas

Because the fee does the work, the honest number is a price per $100 borrowed. Advance America publishes its Texas basis as a typical fee of $15 per $100, which on a two-week loan is roughly a 391% APR. The state’s own required disclosure puts the market average higher. Under §393.223, every CAB must hand you an OCCC-prescribed form before the transaction comparing the loan’s interest, fees, and APR with other kinds of credit. The 2024 revision of that form, using 2022 data reported to the OCCC, ranks six credit types from least to most expensive:

Credit type	Average APR	Fees and interest per $100 over one month
Credit cards	22%	$1.82
Secured loans	30%	$3.55
Signature loans	89%	$13.38
Pawn loans	180%	$15.00
Auto title loans	223%	$19.45
Payday loans	415%	$34.14

The same form has to show what the fees add up to if you refinance and the loan stays open for two weeks, one month, two months, and three months, and it has to describe the typical repayment pattern. That is the state telling you, before you sign, that refinancing is where the cost compounds. For larger multi-payment CAB loans, the OCCC’s 2025 market report works a $1,500 example and lands at 365% to 496% APR for payday and 262% to 366% for title.

The disclosure form is only useful if you read it. Find the federal Truth in Lending box on your contract and compare the Total of Payments with the Amount Financed before anything else; the four checks are in the Texas cost guide.

City ordinances add limits the state does not

Texas leaves loan size and refinances uncapped statewide, so a number of cities have written their own rules. Dallas adopted the first local Credit Access Business ordinance in 2011, Austin and San Antonio followed, and dozens of Texas cities have since adopted a version of the model ordinance published by the Texas Municipal League. These ordinances typically require the CAB to register with the city, limit a payday loan to a share of the borrower’s gross monthly income, cap the number of installments and refinances, and require each refinance to pay down part of the principal.

Whether one applies to you depends on the city where the CAB operates, not the state as a whole, and the specific limits are in each city’s code. If you live in a larger Texas city, search its municipal code for “credit access business” before you borrow. Where an ordinance applies, a lender that offers you more than it allows, or a refinance that pays down nothing, is breaking a local law you can report to the city.

Your rights at the counter

Texas does not cap the price, but it does require the lender to show it to you, and those requirements are enforceable.

1. The posted notice. Under §393.222, every CAB must post its full fee schedule, the OCCC’s name, address, and helpline number, and this exact warning, in the store and on its website: “An advance of money obtained through a payday loan or auto title loan is not intended to meet long-term financial needs. A payday loan or auto title loan should only be used to meet immediate short-term cash needs. Refinancing the loan rather than paying the debt in full when due will require the payment of additional charges.”
2. The cost-comparison disclosure. Under §393.223, you get the OCCC form described above before the transaction, and for a title loan, a written warning that on default you may have to surrender the vehicle.
3. The contract terms. Under §393.201, the CAB’s contract must state the total amount you will pay and describe the services you are paying for.
4. A licensed counterparty. You can confirm the CAB is licensed through the OCCC’s ALECS search at alecs.occc.texas.gov. An unlicensed operator is a reason to walk away regardless of the offer.
5. A regulator that takes complaints. If the business will not resolve a problem, the OCCC’s consumer helpline is (800) 538-1579 and complaints are filed at occc.texas.gov. Its office is at 2601 N. Lamar Blvd., Austin, Texas 78705.
6. The federal Truth in Lending box. Every consumer loan must disclose the APR, finance charge, amount financed, and total of payments in a standard box. Anything a salesperson tells you that the box does not confirm is not a term of your loan.

Active-duty servicemembers and their dependents have one more: the Military Lending Act caps the Military Annual Percentage Rate on payday loans at 36%, which is a fraction of the Texas market rate.

What happens if you cannot repay

Texas has no statewide extended payment plan requirement of the kind some states impose, so your options if the due date arrives without the money are the ones the lender offers and the ones you negotiate. Refinancing is the lender’s default answer and the most expensive one; the required disclosure exists to show you why. Before you refinance, read what happens if you default on a payday loan and how to escape the payday loan cycle, and if the underlying problem is a bill you cannot cover, start with what to do when you can’t make this month’s payment. A negotiated payment plan with the creditor you actually owe is almost always cheaper than a triple-digit loan to keep that account current.

Alternatives worth trying first in Texas

These are roughly cheapest first, with the payday loan last for comparison:

Option	What it costs	The catch
Payment plan on the bill itself	Often nothing	You have to ask before the due date
211 referral to rent, utility, or food help	Nothing	What is funded varies by area
Federal credit union PAL I	Up to 28% APR plus an application fee of up to $20; $200 to $1,000, 1–6 months	One month of membership first; one PAL at a time
Federal credit union PAL II	The same caps; up to $2,000, 1–12 months	Not every federal credit union offers one
Texas payday loan	About $34 in fees and interest per $100 over one month, on average (above)	Average APR of 415%; no state cap on the broker’s fee

The credit union limits come from federal regulation (12 CFR 701.21(c)(7)): no more than three PALs in six months, and no rollovers. Call 211 to reach the local referral line. Employer pay advances and earned-wage apps cost more than their small fees suggest; payday loan alternatives that actually work has the numbers for each option. If an installment loan is on the table, installment loans vs. payday loans explains how to compare total cost.

If you do borrow, borrow the smallest amount over the shortest term you can repay, read the four numbers in the Truth in Lending box, and confirm the lender’s name and the CAB’s license before you sign.