Payday Loan Laws & Regulations by State – 2025 Complete Guide
Last updated: May 8, 2026
27
States Permitting
16
States Banned/Restricted
10
Rate-Capped States
36%
Federal APR Cap (Military)
Payday loan regulation in the United States is a patchwork of state laws with no federal interest rate cap (except for military borrowers). The result is extreme variation: borrowers in Texas or Missouri face virtually unlimited fees, while those in Ohio or Colorado are protected by hard APR caps. This guide documents the key regulatory parameters for every state.
State-by-State Payday Loan Law Reference
| State | Status | APR Cap | Max Loan | Rollovers | Cool-Off Period |
|---|---|---|---|---|---|
| Alabama | Permitted | 456% | $500 | Banned | 1 day |
| Alaska | Permitted | 390% | $500 | 2 max | None |
| Arizona | Banned | 36% | N/A | N/A | N/A |
| Arkansas | Banned | 17% | N/A | N/A | N/A |
| California | Permitted | 460% | $300 | Banned | None |
| Colorado | Rate-Capped | 36% | $500 | Banned | None |
| Connecticut | Banned | 12% | N/A | N/A | N/A |
| Delaware | Permitted | None | $1,000 | 4 max | 60 days |
| Florida | Permitted | 304% | $500 | Banned | 24 hrs |
| Georgia | Banned | 16% | N/A | N/A | N/A |
| Illinois | Rate-Capped | 36% | $1,000 | Banned | 7 days |
| Indiana | Permitted | 390% | $605 | Banned | 7 days |
| Iowa | Permitted | 433% | $500 | Banned | None |
| Kansas | Permitted | 391% | $500 | Banned | None |
| Kentucky | Permitted | 460% | $500 | Banned | None |
| Louisiana | Permitted | 780% | $350 | Permitted | None |
| Maine | Restricted | 30% | $2,000 | Banned | None |
| Maryland | Banned | 33% | N/A | N/A | N/A |
| Massachusetts | Banned | 23% | N/A | N/A | N/A |
| Michigan | Permitted | 369% | $600 | Banned | None |
| Minnesota | Permitted | 200% | $350 | Banned | None |
| Mississippi | Permitted | 520% | $500 | Permitted | None |
| Missouri | Permitted | 1950% | $500 | 6 max | None |
| Montana | Rate-Capped | 36% | $300 | Banned | None |
| Nebraska | Rate-Capped | 36% | $500 | Banned | None |
| Nevada | Permitted | None | 25% income | Permitted | 90 days |
| New Hampshire | Rate-Capped | 36% | $500 | Banned | None |
| New Jersey | Banned | 30% | N/A | N/A | N/A |
| New Mexico | Rate-Capped | 36% | $2,500 | Banned | None |
| New York | Banned | 25% | N/A | N/A | N/A |
| North Carolina | Banned | 30% | N/A | N/A | N/A |
| North Dakota | Permitted | 520% | $600 | Permitted | None |
| Ohio | Rate-Capped | 28% | $1,000 | Banned | None |
| Oklahoma | Permitted | 390% | $500 | Permitted | None |
| Oregon | Rate-Capped | 36% | $50,000 | 2 max | 7 days |
| Pennsylvania | Banned | 6% | N/A | N/A | N/A |
| South Carolina | Permitted | 390% | $550 | Banned | 1 day |
| South Dakota | Rate-Capped | 36% | None | Banned | None |
| Tennessee | Permitted | 390% | $500 | Banned | None |
| Texas | Permitted | 664%+ | None | Permitted | None |
| Utah | Permitted | None | None | Permitted | None |
| Virginia | Rate-Capped | 36% | $2,500 | Banned | 45 days |
| Washington | Permitted | 390% | $700 | Banned | 90 days |
| West Virginia | Banned | 31% | N/A | N/A | N/A |
| Wisconsin | Permitted | None | None | Permitted | None |
| Wyoming | Permitted | None | None | Permitted | None |
Key Federal Protections for All Borrowers
Truth in Lending Act (TILA)
Requires disclosure of APR, total fees, and loan terms before you sign. Violations can make loans unenforceable.
Military Lending Act (MLA)
Caps APR at 36% for active-duty servicemembers and their dependents. Applies to payday loans, auto title loans, and other covered products.
Electronic Fund Transfer Act (EFTA)
Prohibits lenders from requiring automatic repayment via electronic debit as a condition of the loan.
CFPB Payment Provisions
After two failed debit attempts, lenders must get new authorization before attempting again. Protects borrowers from cascading NSF fees.
Fair Debt Collection Practices Act (FDCPA)
Debt collectors cannot harass, threaten, or deceive you. Applies when a third-party collector is pursuing payday loan debt.
Frequently Asked Questions
Which states have banned payday loans?
As of 2025, payday loans are effectively banned or heavily restricted in: Arizona, Arkansas, Connecticut, Georgia, Maryland, Massachusetts, New Jersey, New York, North Carolina, Pennsylvania, Vermont, West Virginia, and the District of Columbia. These states enforce rate caps so low (typically under 36%) that traditional payday lending is unprofitable.
What is the CFPB payday loan rule?
The Consumer Financial Protection Bureau (CFPB) issued a payday lending rule in 2017 requiring ability-to-repay assessments. The rule was significantly scaled back in 2020 and portions remain in legal limbo. The payment provisions (limiting debit attempts after two failures) remain in effect. Check cfpb.gov for the latest status.
Can a payday lender sue me if I can't repay?
Yes. Payday lenders can pursue civil court action for unpaid debts. However, many states limit how lenders can collect. They cannot threaten criminal prosecution for bad checks unless you acted fraudulently. If sued, you have the right to appear in court and raise defenses including state law violations by the lender.
What happens if a payday lender violates state law?
Violations of state payday lending laws can result in the loan being void and uncollectable, refund of fees paid, regulatory action against the lender's license, and civil damages in some states. Report violations to your state banking regulator and the CFPB.
Do federal laws protect payday loan borrowers?
Yes. Key federal protections include: Truth in Lending Act (requires APR disclosure), Electronic Fund Transfer Act (limits debit authorization), Fair Debt Collection Practices Act (restricts collectors), Military Lending Act (36% APR cap for active-duty servicemembers and dependents), and CFPB payment provisions.