What a title loan costs — before Vermont’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 Vermont
- Rate cap
- General consumer-loan rates are capped in the roughly 18%-24% APR range (e.g., 18% on many single-payment/regulated loans; 24% on the first tranche of small loans). These caps make high-APR single-payment title loans illegal and non-viable.
- Key law
- Vermont interest/usury and licensed-lender law, 9 V.S.A. Sec. 41a (maximum rates) and 8 V.S.A. ch. 73 (Licensed Lenders).
- Enforcement
- The Vermont Attorney General's Consumer Assistance Program and the Department of Financial Regulation treat unlicensed high-rate lending as illegal. The AG's office publicly warns that car title loans using your vehicle as collateral are not permitted in Vermont.
Vermont's usury caps (about 18%-24% APR under 9 V.S.A. Sec. 41a) and licensing rules make car title loans illegal; the Vermont AG states title loans are not permitted.
What it means for a Vermont borrower
You cannot get a car title loan in Vermont. State interest-rate caps (roughly 18%-24%) and strict lender licensing make high-cost title lending illegal, and no licensed lender offers it. Any lender advertising a title loan to Vermont residents is operating outside the law.
If you already have a title loan in Vermont
A loan that violates Vermont’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 Vermont — many high-cost online lenders are not.
- Revoke ACH authorization in writing to stop automatic withdrawals from your account.
- File a complaint with the Vermont attorney general and the CFPB.
- Ask whether the balance is even collectable under Vermont law before you pay a collector.
Cheaper first — try these before a title loan in Vermont
Title Loans and tribal lenders in Vermont
Many online lenders that market title loans to Vermont 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 Vermont residents and how state law applies to them, see the Vermont tribal-lending page.
Tribal loans in Vermont →Frequently asked questions
Are title loans legal in Vermont?
In Vermont, 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 Vermont?
General consumer-loan rates are capped in the roughly 18%-24% APR range (e.g., 18% on many single-payment/regulated loans; 24% on the first tranche of small loans). These caps make high-APR single-payment title loans illegal and non-viable.
What can I do about a title loan I already have in Vermont?
Because Vermont 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 Vermont — many high-cost online lenders are not. This is general information, not legal advice.