Installment Loans in Texas
Page last reviewed: March 30, 2026 · Reviewed for accuracy by LendUp
Are installment loans legal in Texas? Yes. Consumer installment loans are regulated under the Texas Finance Code. Lenders must hold a Regulated Lender License from the Texas Office of Consumer Credit Commissioner (OCCC).
Two product types: Texas has two installment loan structures — one for larger loans with tiered interest rates, and one for smaller loans that use flat charges instead of traditional interest. The type you're offered depends on the loan amount. Your lender must tell you which type applies.
Not the same as payday: Texas also has Credit Access Businesses (CABs) that broker payday and auto title loans under different rules. If you're offered a product through a CAB, that's a different product with a different cost structure. Make sure you know which one you're getting.
To qualify:
- Credit: Most installment lenders review your credit, but approval isn't based solely on your score. Ask what type of credit check they'll run before you authorize it.
- Basics: You'll typically need to be 18+, have a government-issued ID, verifiable income, and an active checking account for deposit and repayment.
- Military households: If you or your dependent are covered by the Military Lending Act, your total loan cost is capped at 36% per year (called the Military Annual Percentage Rate), which may limit available offers.
LendUp isn't a lender - we connect you with providers. Offers aren't guaranteed, and we may earn compensation if a loan is funded.
How to Apply
Steps
- Submit one request through LendUp or contact a licensed lender directly.
- Gather what you'll need: government-issued ID, proof of income (pay stubs, benefit letters, or bank statements), and your bank account details for deposit and repayment.
- Review the offer: confirm the full payment schedule and the total amount you'll repay — not just the monthly payment, but all interest, fees, and charges added together.
- Verify the lender holds an active Texas Regulated Lender License through NMLS Consumer Access before you sign. Save a copy of the signed agreement.
What to expect
- Credit check: You may see a soft check (no score impact) for prequalification and a hard check (small score impact) if you accept. Ask before you agree.
- Income verification: The lender may ask for pay stubs, bank statements, or benefit letters. If they request bank login access, ask whether uploading statements is an option instead.
- How charges work: On a larger installment loan, you'll see interest calculated at tiered rates set by state law plus a small one-time administrative fee. On a smaller loan, you'll see flat charges (an upfront charge plus a monthly handling charge) instead of traditional interest. Either way, the lender must show you every charge in writing before you sign. For the exact caps, see Texas rates and fees.
- Your contract must be readable: Texas requires installment loan contracts to be written in plain language. If the lender can't explain the terms clearly, slow down before signing.
- Automatic payments: Most installment loans use automatic withdrawals from your bank account. If your paydays don't match the due dates, ask whether the lender can adjust the schedule to avoid overdraft fees.
Verify an Installment Lender in Texas
Before sharing your Social Security number or bank details, confirm the lender holds an active Regulated Lender License from the Texas OCCC.
- Go to NMLS Consumer Access. Search by the company's NMLS number if available — check the lender's website under "Legal" or "Disclosures" for this number.
- If you don't have the NMLS number, search by the company's full legal name. Try "doing business as" (DBA) names if the first search returns nothing.
- Open the result and look under State Licenses/Registrations. Confirm Texas is listed with a Regulated Lender license — not a Credit Access Business license, which is a different product type.
- If you can't find the lender, call the OCCC Consumer Assistance Helpline at (800) 538-1579 before you proceed.
To report an unlicensed lender or file a complaint, contact the OCCC at [email protected], call (800) 538-1579, or file online. You can also file with the CFPB.
If you apply through LendUp, we'll try to match you with licensed providers, but you should still verify the lender before accepting an offer.
Before You Sign
Your rights in Texas
- Pay off early: You can prepay your loan in full at any time. If you do, the lender must refund any unearned interest so you're not charged for time you didn't use the money.
- Late payment limits: If you're more than 10 days late on a payment, the lender may charge a late fee — but it's capped at 5 cents per dollar of the missed payment, and can only be charged once per late installment.
- One-time fee limits: The administrative fee on larger loans is capped by state law and can only be charged once within a set period. If you refinance, ask whether a new fee applies.
- Readable contracts: The OCCC publishes model contracts that meet readability requirements. If a lender uses a different format, it must still meet the same font and readability standards.
- Smaller loans: no insurance charges. On the smaller loan type, the lender is not authorized to charge insurance premiums — only the upfront charge and monthly handling charge. If you see insurance on a small loan, question it.
Walk away if
- An upfront fee is required before you receive any money.
- The lender shows only the monthly payment and won't state the total you'll repay in writing.
- You're pressured to sign immediately or told you can't review the agreement on your own time.
- The lender can't be found in NMLS Consumer Access with an active Texas Regulated Lender license.
- The lender can't clearly explain whether they're offering an installment loan or a CAB-brokered payday/title product.
- The contract is difficult to read or the lender can't explain the disclosures clearly.
If payments look tight, compare alternatives and review red flags on scams and safety.
Installment Loan Questions in Texas
What's the difference between an installment loan and a payday loan from a CAB?
An installment loan is made directly by a licensed lender with state-capped rates, repaid over scheduled installments. A payday or title loan brokered through a Credit Access Business (CAB) is a short-term product where the CAB charges a separate fee for arranging the loan with a third-party lender. The costs, protections, and repayment structures are different. Make sure you know which product you're being offered.
What's the difference between the two installment loan types?
Texas has two structures for installment loans. The larger-loan type uses tiered interest rates — the rate decreases as the loan amount increases, with caps set by state law. The smaller-loan type doesn't use traditional interest — instead, it uses a flat upfront charge plus a monthly handling charge. The lender must tell you which type applies and show you all charges before you sign. For specific caps, see our rates and fees page.
Can I pay off my loan early?
Yes. You can prepay in full at any time. The lender must refund any unearned interest so you only pay for the time you actually had the money.
What happens if I miss a payment?
If your payment is more than 10 days late, the lender may charge a late fee capped at 5 cents per dollar of the missed payment. The lender may also demand the full remaining balance at once. If you can't repay, see what to do if you can't repay and contact your lender right away.
How do I verify a lender is licensed in Texas?
Use NMLS Consumer Access and search by the company's NMLS number or legal name. Confirm Texas is listed with a Regulated Lender license — not a CAB license. If you can't find the lender, call the OCCC at (800) 538-1579.
What if an online lender says Texas law doesn't apply to them?
Any lender making consumer loans above 10% interest to Texas residents must hold a Regulated Lender License from the OCCC, regardless of where the company is located. A lender claiming to be exempt is a significant red flag. Verify their license before sharing personal information.
Can a lender threaten arrest if I don't pay?
No. Missed loan payments are a civil matter, not criminal. If a lender or collector threatens arrest, report it to the OCCC, the CFPB, and the Texas Attorney General.
Where do I file a complaint about a Texas installment lender?
Call the OCCC at (800) 538-1579 or email [email protected]. The OCCC establishes the facts, applies the relevant law, and when warranted, may mediate a resolution. Be aware that complaints become part of the public record under the Texas Public Information Act. You can also file with the CFPB.
Official Sources and Update Notes
This page provides general information, not legal advice. Rules can change; confirm current requirements with the Texas regulator before acting.
Texas regulator: Texas Office of Consumer Credit Commissioner (OCCC)
Regulated Lender information: OCCC — Regulated Lenders
License verification: NMLS Consumer Access
Consumer helpline: (800) 538-1579 · [email protected]
File a complaint: OCCC — File a Complaint or CFPB
Texas Finance Code, Chapter 342: statutes.capitol.texas.gov
For statewide rules and context, go back to the Texas lending guide or browse all states in the state directory.