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Legal APR Limits for $1,000 Loans (State by State)

When you borrow around $1,000, understanding the legal interest rate limits in your state is important. These laws — often called “usury laws” — help protect borrowers from excessively high APRs. At EasyFinance.com, a BBB-accredited platform, we encourage you to check state limits and lender transparency before you apply for a $1,000 loan.

How State APR Limits Work

There is no single federal cap on APRs for all personal loans. Instead, each U.S. state sets its own maximum interest rate or uses formulas and exceptions for different types of loans. States often differentiate based on loan amount, term, lender type, and whether the borrower is a consumer.

Because a $1,000 loan may fall into a “small loan” or “mid-size loan” category, the applicable rate cap may be stricter than for larger loans.

Representative State Examples

Maryland

In Maryland, for consumer loans of $1,000 or less the statute limits the maximum allowed interest rate to 2.75% per month — about 33% APR. For loans larger than $1,000 up to $6,000, the limit is 2% per month (about 24% APR).

Washington

Washington state’s general usury law states that a lender may charge the higher of either 12% per year or 4% above the auction result of the 26-week Treasury bill for consumer loans not otherwise exempt. That means typical max rate is about 12% APR unless the Treasury-bill referenced rate is higher.

States With Looser or No Caps

Some states have very weak or no effective caps on certain consumer loans. For example, certain states allow much higher APRs because payday-loan or short-term special-purpose loan laws operate under a different regime.

Why the Limits May Not Always Apply

  • Some lenders (especially national or out-of-state banks) are exempt from a state’s usury cap because their charter state permits higher rates.
  • The cap may apply only to certain loan sizes, terms or consumer types; e.g., loans under $1,000 vs larger.
  • Special loan types like payday, title, or tribal jurisdiction loans may have different rules.

What This Means If You’re Borrowing $1,000

If you’re seeking a $1,000 loan, you should:

  • Check the maximum APR for your state’s consumer small-loan laws (or “single payment loan” laws) and determine which category your loan falls under.
  • Ensure the lender discloses APR, fees and term clearly and confirms they are licensed in your state.
  • Be aware that even if a state cap exists, your loan may be exempt if structured as a non-traditional loan or if the lender is governed by another state’s laws.
  • Use comparison sites like EasyFinance.com to find lenders that operate legally, show clear terms, and don’t try to bypass the law.

General Range of State APR Caps for Small Loans

Based on available research, here are some approximate ranges for APR caps on small or mid-size loans (not necessarily exactly $1,000) in states that impose caps:

  • Many states: caps around 30% to 36% APR
  • Some states: lower caps around 15% to 25% APR
  • A few states: no cap except for “unconscionability” or special rules

Why Borrowers Still Face High APRs

Despite state limits, many borrowers end up paying high rates because:

  • The loan is exempt (tribal, payday, small amount, short-term) and governed under different rules.
  • The lender uses a national bank charter to apply a different state’s rate cap.
  • Fees and effective interest push the APR beyond what is disclosed.

Key Questions to Ask Your Lender

  • What is the APR for the $1,000 loan, and is that within my state’s legal limit?
  • Are there any upfront or hidden fees added to the loan cost?
  • Is the lender licensed in my state, and which state’s laws govern the rate?
  • What is the repayment term, and does that impact how the APR is calculated?

Key Insights

  • State interest rate caps vary widely; for a $1,000 loan you may see caps as low as ~24-33% APR (Maryland example) or much lower (Washington’s ~12%).
  • Many small-loan caps are around 30-36% APR, but many loans are exempt from those caps.
  • Even with a cap in place, your loan may fall into an exemption or another state’s law may apply.
  • Always check the lender’s disclosures, APR, fees and licensing before borrowing $1,000.
  • EasyFinance.com helps you compare legitimate lenders who operate under transparent laws and respect consumer protections.

FAQ

Is there a national APR cap for $1,000 loans?

No. There is no general federal cap on all consumer loans. Usury and interest rate regulation mostly occurs at the state level.

Does the listed cap always apply to my $1,000 loan?

Not necessarily. The cap may depend on loan size, term, lender type, or may be exempt if the lender uses a bank charter from another state.

What if I live in a state with a low cap but the lender is headquartered elsewhere?

In some cases, the lender may be exempt and apply the home state rate. That is why checking lender licensing, governing law and APR is critical.

Can I still borrow if my state has a low cap like 12% or 24% APR?

Yes — you just need to find a lender who offers a $1,000 loan with terms that meet that cap. Using comparison tools like EasyFinance.com may help locate lenders compliant with your state rules.

Why do some $1,000 loans have APRs much higher than 100%?

Those higher APRs often come from loans exempt from state caps (such as payday, small-dollar, tribal, or bank-charter loans) and may not be subject to the general usury laws. Borrowers should be cautious of these high-cost loans.

Related $1,000 Loan Guides and Resources

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