What a title loan costs — before New York’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 New York
- Rate cap
- Civil usury limit 16% per annum (Gen. Oblig. Law 5-501); criminal usury above 25% per annum (Penal Law 190.40), a Class E felony.
- Key law
- New York General Obligations Law 5-501 (16% civil usury) and Penal Law 190.40/190.42 (criminal usury, 25%).
- Enforcement
- Enforced by the NY Department of Financial Services and the Attorney General. Charging more than 25% is a felony; usurious loans are void and unenforceable.
New York's criminal usury threshold is 25% per annum (Penal Law 190.40), a Class E felony, and its civil usury cap is 16%.
What it means for a New York borrower
Car title loans are effectively illegal in New York because they far exceed the 16% civil and 25% criminal usury caps. No licensed lender can offer them, and a loan above 25% interest can expose the lender to felony charges.
If you already have a title loan in New York
A loan that violates New York’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 New York — many high-cost online lenders are not.
- Revoke ACH authorization in writing to stop automatic withdrawals from your account.
- File a complaint with the New York attorney general and the CFPB.
- Ask whether the balance is even collectable under New York law before you pay a collector.
Cheaper first — try these before a title loan in New York
Title Loans and tribal lenders in New York
Many online lenders that market title loans to New York 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 New York residents and how state law applies to them, see the New York tribal-lending page.
Tribal loans in New York →Frequently asked questions
Does an online or tribal lender have to follow New York's title loan rules?
New York applies its rules to loans made to its residents, wherever the lender sits. Tribal lenders argue that sovereign immunity puts them outside state rate caps — an argument courts have accepted in some cases and rejected in others. For which tribal brands lend to New York residents and how the state treats them, see the New York tribal-loan page.
What can I do about a title loan I already have in New York?
Because New York effectively bans high-cost title loans, a loan that exceeds the state limit may be partly or fully uncollectible — so find out before you pay a collector anything more. The steps on this page start with the lender's license. This is general information, not legal advice.