Effective January 1, 2016 to December 31, 2016

The maximum rates available for the financing of vehicles in equal monthly installments are found in the Texas Finance Code, Section 348.104. That section specifies add-on rates for four classes of vehicle. The add-on rate is the actual dollars per hundred per year of finance charge calculated on the amount financed. The age of the vehicle determines the add-on rate to use. This chart converts the add-on rates to equivalent annualized percentage rates for contracts with substantially equal monthly payments.

As an alternative to the add-on rates, Section 348.105 of the Texas Finance Code provides an alternate rate of 18%. The 18% effective rate may also be used as an alternative rate for contracts with repayment terms that are not monthly and not substantially equal in amount.

Caution: Do not confuse add-on rates with APRs. You cannot quote add-on rates to consumers. If the transactions are seller-financed sales tax transactions (sales tax deferred), the “contract rate” shown on the motor vehicle retail installment sales contract cannot exceed the equivalent annualized percentage rates shown below.


Newer Vehicles

Class 1 and 2

To make this chart simpler, conversions are omitted for Classes 1 and 2 because they result in rates less than the alternate rate of 18% provided by section 348.105 of the Texas Finance Code. The following vehicles fall into Classes 1 and 2:

  • Any 2014 or newer vehicle
  • Any used motor vehicle not more than two years old
  • Any new or used heavy commercial vehicle not more than two years old

Used Vehicles

Class 3: Add-on rate expressed as contract rate

Vehicles 2013 or 2012 can use the Class 3 add-on rate of $12.50 per hundred per year. Here is the $12.50 add-on rate expressed as equivalent annualized percentage rates for common contract terms:

12 Months 18 Months 24 Months 30 Months 36 Months 48 Months 60 Months
22.3232% 22.5020% 22.4150% 22.2311% 22.0077% 21.5273% 21.0533%

Class 4: Add-on rate expressed as contract rate

Vehicles 2011 or older can use the Class 4 add-on rate of $15.00 per hundred per year. Here is the $15 add-on rate expressed as equivalent annualized percentage rates for common contract terms:

12 Months 18 Months 24 Months 30 Months 36 Months 48 Months 60 Months
26.6226% 26.7540% 26.5783% 26.2964% 25.9759% 25.3155% 24.6845%

The OCCC also provides a month-by-month chart expressing the $12.50 and $15 add-on rates as equivalent annualized percentage rates for contracts with substantially equal monthly payments with terms ranging from 1 to 84 months. 

Archived Vehicle Class Years.

Below are the years to be used for each class in a given year. To find the appropriate maximum rate, using the chart below, determine the calendar year and year of the vehicle to find the correct class. Once you have found the correct class, use the charts above to determine the maximum rate.

For example, a 2008 motor vehicle sold in 2012 would be considered a Class 3 vehicle. Financing a Class 3 vehicle in 2012 for 36 months would return a maximum rate of 22.0077%.

Calendar Year of Vehicle Sale Class 1 or Class 2 Class 3 Class 4
2015 2013 or newer 2012 or 2011 2010 or older
2014 2012 or newer 2011 or 2010 2009 or older
2013 2011 nor newer 2010 or 2009 2008 or older
2012 2010 or newer 2009 or 2008 2007 or older
2011 2009 or newer 2008 or 2007 2006 or older
2010 2008 or newer 2007 or 2006 2005 or older
2009 2007 or newer 2006 or 2005 2004 or older
2008 2006 or newer 2005 or 2004 2003 or older
2007 2005 or newer 2004 or 2003 2002 or older

If you have any questions concerning the financing of motor vehicles, please contact the Office of Consumer Credit Commissioner at 512.936.7600.