What a title loan costs — before Connecticut’s rules
A title loan is usually a single-payment loan due in 15–30 days at around 25% per month — roughly 300% APR — secured by your vehicle. The defining risk is not the rate but the collateral: miss a payment and the lender can repossess the car, and research finds about one in five borrowers eventually loses the vehicle. Where a state caps rates low, single-payment title lending is not offered and a loan above the cap is generally void.
The law in Connecticut
- Rate cap
- Small Loan Act caps APR at the lesser of 36% or the Military Lending Act rate on loans under $5,000 (25% on $5,000–$50,000); a motor-vehicle security interest is allowed only for purchase/refinance auto loans, not cash title loans (Conn. Gen. Stat. 36a-563, 36a-558).
- Key law
- Connecticut Small Loan Lending and Related Activities Act, Conn. Gen. Stat. 36a-555 to 36a-573 (general usury 12%, Conn. Gen. Stat. 37-4).
- Enforcement
- The Connecticut Department of Banking licenses small-loan lenders and can void loans made without a license or above the cap. Unlicensed high-rate lending is unenforceable in the state.
Connecticut caps APR at the lesser of 36% or the Military Lending Act rate on consumer loans under $5,000, and allows a motor-vehicle security interest only for purchase or refinance of the vehicle, not for cash title loans.
What it means for a Connecticut borrower
You cannot get a traditional high-APR car title loan in Connecticut. Any cash loan secured by your vehicle title is capped near 36% APR, which makes storefront title lending unprofitable, so it effectively does not exist. If an online or out-of-state lender offers you one, the loan may be illegal and unenforceable here.
If you already have a title loan in Connecticut
A loan that violates Connecticut’s ban may be partly or fully unenforceable — which changes your options with the lender and any collector. This is general information, not legal advice.
- Check whether the lender is licensed in Connecticut — many high-cost online lenders are not.
- Revoke ACH authorization in writing to stop automatic withdrawals from your account.
- File a complaint with the Connecticut attorney general and the CFPB.
- Ask whether the balance is even collectable under Connecticut law before you pay a collector.
Cheaper first — try these before a title loan in Connecticut
Title Loans and tribal lenders in Connecticut
Many online lenders that market title loans to Connecticut residents are tribal lenders arguing their sovereignty places them outside state rate caps — a separate legal question this site tracks in depth. For which tribal brands lend to Connecticut residents and how state law applies to them, see the Connecticut tribal-lending page.
Tribal loans in Connecticut →Frequently asked questions
Are title loans legal in Connecticut?
In Connecticut, a high-cost single-payment title loan is not legally viable. The state’s rate cap or an outright ban makes a ~300% APR title loan void or unavailable, so licensed title lenders do not operate — and a lender that lends anyway is on weak legal footing.
What is the maximum title loan rate in Connecticut?
Small Loan Act caps APR at the lesser of 36% or the Military Lending Act rate on loans under $5,000 (25% on $5,000–$50,000); a motor-vehicle security interest is allowed only for purchase/refinance auto loans, not cash title loans (Conn. Gen. Stat. 36a-563, 36a-558).
What can I do about a title loan I already have in Connecticut?
Because Connecticut effectively bans high-cost title loans, a loan that exceeds the state limit may be partly or fully uncollectible. Check whether the lender is licensed in Connecticut — many high-cost online lenders are not. This is general information, not legal advice.