A $1,840 Texas Pawn Loan Costs $276 a Month. Borrow $1,841 and It's $46.

If you’re pawning something in Texas for somewhere between $1,500 and $1,840, the shop can charge you six times the rate it could charge on a slightly bigger loan. The fix is strange but legal: ask for a bigger loan.

Texas pawn charges come in brackets, and the bracket rate applies to the whole loan. For loans made from July 1, 2026 through June 30, 2027, a pawn loan of $1,840 can be charged 15% a month. That’s $276. A loan of $1,841 can be charged 2.5% a month. That’s $46.03.

One extra dollar. About $230 a month cheaper.

The cliff in the statute

The rule is Texas Finance Code 371.159. It sets four tiers: 20% of the amount financed per month for the smallest loans, 15% for the next band, 2.5% for the band after that, and 1% for anything larger. The dollar lines move every July with inflation. The Office of Consumer Credit Commissioner’s current notice puts them at $276, $1,840 and $2,760. And don’t expect a discount off the cap: the OCCC says “most pawnshops charge the maximum rates.”

The key word in the statute is “total.” The percentage hits the total amount financed. It’s not like income tax, where only the dollars above a line get the higher rate. Cross a line and the entire loan reprices.

So the charges look like this. A $276 loan: $55.20 a month. A $277 loan: $41.55. A $2,760 loan: $69. A $2,761 loan: $27.61.

The regulator knows exactly what this does. Its December 2025 study says the amount a pawnbroker lends “is influenced by the maximum service charge a pawnbroker is permitted to earn,” and that even when you ask for more, you “may receive a lower loan amount or be asked to pledge additional collateral across multiple tickets.”

Translation: the shop’s best loan is the one sitting just under $1,840.

The math on what you actually need

Say you need $1,500 and your item can support more. At $1,500 the shop can charge 15%, or $225 a month.

Now borrow $1,841 instead and leave the extra $341 untouched. The charge is $46.03 a month. You hand the $341 back when you redeem. Over two months, that’s about $92 instead of $450.

That’s not a loophole. It’s the statute working as written. The shop just has no reason to point it out.

Splitting one item across two tickets kills the trick. Two $1,000 tickets each sit in the 15% band, and that’s $300 a month on $2,000. One $2,000 ticket at 2.5% is $50.

What to do at the counter

Check the bracket before you agree to a number. If the offer lands between $1,500 and $1,840, ask for $1,841 or more on a single ticket. If the item won’t support it, the 15% rate is the real price, so compare it with other options first.

Check a credit union too. A federal credit union’s payday alternative loan can charge at most 10 points above the NCUA’s 18% ceiling, so 28% APR (here’s how those work). Run any quote through our loan calculator. A pawn loan at 15% a month is 180% a year. Compare it with the title loan math too, and you’ll see the one upside: walk away from a pawn loan and you lose the item, nothing else. You can compare personal loan options on our loans hub and the best loans page.

If you can’t redeem on time, Texas gives you at least 30 days past maturity. You pay one-thirtieth of the monthly charge per day while you catch up.

The detail

Brackets come from the OCCC’s 2026 rate bracket notice, which applies the December 2025 CPI to the statute’s reference amounts of $30, $200 and $300. The OCCC’s December 2025 study reports 5.29 million Texas pawn loans in 2024 averaging $218, so the average loan sits in the 20% tier, about $43.60 a month. Per the study, a forfeited item ends the debt: no deficiency, no lawsuit and no credit report. Monthly charges and the two-month comparison are our math from the statute’s rates.

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