What is the maximum permissible interest rate for loans in Texas?

In Texas, the maximum permissible interest rate for loans is 10% per annum unless the parties agree to a higher rate in writing. This provision is rooted in Texas law, specifically designed to offer clarity for both borrowers and lenders regarding the default maximum rate that can be charged. The requirement for a written agreement if a higher rate is to be enforced ensures that both parties have a clear understanding and consent to the terms of the loan.

This approach allows for flexibility in financial transactions while also providing protections to borrowers against excessive interest rates that could lead to problematic debt situations. In practice, this means that unless explicitly stated and agreed upon, lenders are limited to charging 10% per annum on loans, which helps maintain a level of fairness in the lending process.

Other options suggest different fixed rates or an automatic application of rates that do not accurately reflect the legal framework in Texas. By establishing a baseline rate of 10% whilst allowing for negotiated agreements above that threshold, the law balances the interests of lending with consumer protection.