Texas Promissory Note
Texas Promissory Note & Maximum Interest Rate
For a basic personal loan, Texas caps interest at 10% per year (general cap).
Interest rate limits in Texas
Texas generally caps interest at 10% per year for contracts that don't fall under a specific alternate rate ceiling, under the Texas Constitution and Finance Code.
If a note doesn't specify a rate, Texas law sets the default legal rate at 6% per year.
Texas usury law has numerous alternate ceilings and exemptions depending on the type of loan and lender — this guidance is scoped to a simple personal note.
Reference: Texas Finance Code Chapter 302; Texas Constitution Art. XVI §11. This is general educational information scoped to a basic personal loan between individuals — not legal advice. Usury law has many exceptions (banks, licensed lenders, business loans, and loan size thresholds). Confirm current Texas law and any applicable exceptions before relying on a rate.
Texas key points
- 10% per year general usury cap absent another applicable ceiling.
- 6% per year applies by default if the note doesn't state a rate.
- Alternate ceilings and exemptions can apply depending on the loan type and lender.
How to create your Texas promissory note
- 1. Open the iRunDocs promissory note generator with Texas selected.
- 2. Enter the lender, borrower, principal amount, and repayment terms.
- 3. Set an interest rate within Texas's limits above, or leave it interest-free.
- 4. Review the PDF preview, download, sign, and keep a copy with your records.
Frequently asked questions
What is the maximum interest rate for a personal loan in Texas?
Generally 10% per year under the Texas Constitution and Finance Code Chapter 302, absent an applicable alternate ceiling.
What interest rate applies if a Texas note doesn't state one?
6% per year applies by default when no rate is specified in the agreement.
Are there exceptions to the Texas usury cap?
Yes. Texas has multiple alternate interest ceilings and lender-specific exemptions; this guidance covers a basic personal note only.
Interest rate limits in other states
iRunDocs provides document tools and educational information. It is not a law firm and does not provide legal advice.