Title loans, called title pledges in Tennessee law, are legal when made by a licensed title pledge lender. A pledge against one vehicle title is limited to $2,500, the agreement runs for 30 days and may renew for additional 30-day periods, and the lender may charge up to 2% interest per month plus a fee of up to one-fifth of the principal or unpaid renewal balance.
Last reviewed: August 12, 2026. This page provides general consumer information, not legal advice.
Is a title loan legal in Tennessee?
Tennessee permits title pledge lending under the Tennessee Title Pledge Act. The Tennessee Department of Financial Institutions (TDFI) licenses and supervises title pledge lending companies. TDFI’s Title Pledge Lender FAQ explains the statute’s limits, fees, renewals, repossession, and lender recourse.
A title pledge is not a general-purpose vehicle loan. It is a statutory product secured by titled personal property, with distinct rules on default and sale. Verify the company through TDFI’s regulated-entity tools and read the consumer notification and disclosure form before making a commitment.
Sources: TDFI Title Pledge Lender FAQs, Tennessee Title Pledge Act resources, and TDFI consumer-lending oversight.
Tennessee title loan limits
| Rule | Tennessee limit or requirement |
|---|---|
| Maximum APR / interest rate | Interest may not exceed 2% per month. In addition, a lender may charge a customary fee of no more than one-fifth of the original principal, or of the unpaid balance at the start of a renewal. Tenn. Code Ann. § 45-15-111(a). |
| Maximum loan amount | The aggregate amount against any one pledged property title is limited to $2,500. Tenn. Code Ann. § 45-15-115(3); TDFI Title Pledge FAQ. |
| Minimum / maximum term | A title pledge agreement has a 30-day term. It may provide for additional 30-day renewals as allowed by Tenn. Code Ann. § 45-15-113(a). |
| Rollovers or renewals | Agreements may provide for renewal in additional 30-day periods, subject to the statute and agreement. Review whether renewal is automatic, what payment is due, and the effect of a missed payment before signing. |
| Repossession notice period | After repossession, the lender must retain the vehicle and certificate of title for a 20-day holding period before sale. Tenn. Code Ann. § 45-15-114. |
| Right to cure / redeem | During the 20-day holding period, the borrower may redeem by paying the repossession charge and all outstanding principal, authorized interest, and authorized fees. Tenn. Code Ann. § 45-15-114(b)(2). |
| Surplus return after sale | After a commercially reasonable sale, any surplus must be remitted to the borrower and may not be retained by the lender. Tenn. Code Ann. § 45-15-114(b)(3). |
What you need to apply in Tennessee
Expect the lender to evaluate the title and vehicle, but do not treat the title as the only document that matters. A title pledge lender should provide the standard consumer notification and disclosure information required under the Act. Ask for the exact principal, monthly interest, customary fee, maturity date, renewal terms, repossession charge policy, and the total required to redeem the vehicle after default.
The legal $2,500 limit is tied to one pledged title. A clear explanation of lien status, ownership, vehicle identification, insurance, and the lender’s right to take possession should appear in the agreement. Do not sign an incomplete document or depend on a verbal promise about renewals or return of the title.
How repossession works in Tennessee
For a Tennessee title pledge default, the lender’s recourse is limited to repossession and sale of the pledged vehicle. TDFI states that the lender cannot pursue a deficiency under the Title Pledge Act. After taking possession, it must retain the vehicle and title for 20 days, and no further interest or other fees may be charged from the start of that holding period.
During the holding period, you can redeem the vehicle by paying the amounts specified by the Act, including actual permissible repossession charges. If you do not redeem, the lender has 60 days to make a commercially reasonable sale. Sale proceeds go to principal, authorized interest and fees, and actual direct sale costs; any surplus belongs to you. Keep the contract and all notices, and contact TDFI or a lawyer promptly if the figures do not add up.
Licensed alternatives in Tennessee
Household-assistance and regulated-credit options can address an urgent expense without putting a vehicle at risk. These Tennessee resources provide practical places to start.
- Food, cash, and family benefits: the One DHS Customer Portal supports applications for SNAP, Families First (TANF), emergency or disaster assistance, and other services.
- SNAP application help: Tennessee DHS explains the SNAP application process, including online, local-office, and mail options.
- Utility assistance: Tennessee’s energy-assistance information identifies the state’s LIHEAP program and local support contacts.
- Credit-union small loans: ask an eligible federal credit union about a Payday Alternative Loan and review the NCUA PALs II rule.
- Title-lender concern: submit records through TDFI Consumer Resources, which handles written consumer complaints involving regulated title pledge transactions.
Cities we serve in Tennessee
Tennessee location pages are still undergoing the execution plan’s lender-relationship and content-quality review. No local links are shown until a city page is confirmed as an accurate, surviving destination. This statewide page is currently the reliable source for Tennessee title-pledge rules and consumer protections.
Frequently asked questions
Are title loans legal in Tennessee?
Yes. Tennessee calls the product a title pledge and regulates it under the Title Pledge Act. The Tennessee Department of Financial Institutions licenses and supervises title pledge lenders. Check the company’s status and obtain the required disclosures before you sign or provide title documentation.
What is the most I can borrow with a Tennessee title pledge?
A title pledge against one vehicle title is limited in the aggregate to $2,500. The rule applies to a single pledged property title; it is not a guarantee that a lender will offer that amount. The agreement must disclose the actual principal and other charges.
How much can a Tennessee title lender charge?
The lender may charge interest of up to 2% per month and a customary fee of up to one-fifth of the original principal or the unpaid balance at the beginning of a renewal. Those charges are distinct, so review both lines of the written disclosure rather than relying on an interest-rate quote alone.
How long do I have to recover my car after repossession?
Tennessee requires a 20-day holding period after repossession. During that period, you may redeem the vehicle and title by paying the repossession charge plus outstanding principal, authorized interest, and authorized fees. No further interest or other fees accrue once that holding period begins.
Can a Tennessee title lender sue me for a deficiency?
Under the Title Pledge Act, the lender’s default recourse is repossession and sale of the pledged property. TDFI states that the lender cannot sue for a deficiency. If the vehicle sells for more than the authorized amounts and direct sale costs, the surplus must be sent to you.
