Louisiana Car Loan Laws

Louisiana sets four rate ceilings by vehicle age, indexes the dealer doc fee each year, and allows repossession without a court only after two missed payments.

Updated Oct 26, 2026 By Lenditia Editorial Team 6-minute read No right to cure

In short

Louisiana's Motor Vehicle Sales Finance Act caps a dealer contract at 18% a year on a new car, rising to 33% on used cars more than four model years old. The dealer's documentary fee is capped at $436 for 2026 and must be disclosed in writing. There is no right to cure, but a lender may repossess without going to court only after two consecutive missed payments. The state sales tax rate is 5% through 2029, plus parish and city taxes. The Louisiana Motor Vehicle Commission administers the finance act.

Right to cure: None in state law
Rate ceiling: 18% to 33% by car age
Doc fee limit: $436 in 2026
Vehicle sales tax: 5% state plus local tax

Map of the United States with Louisiana highlighted

Louisiana car-finance rules at a glance

Louisiana No right to cure No general right to cure in state law Checked Oct 26, 2026

Right to cure: None; self-help repossession only after two missed payments in a row; R.S. 6:965 and 6:966 also require an earlier written warning; this is a trigger, not a cure period.
Rate ceiling: 18% new, 24% recent, 27% or 33% on older used cars; R.S. 6:969.10. Contracts assigned within 35 days to a licensed lender may carry loan rates (R.S. 6:969.11).
Doc fee limit: $436 in 2026 (indexed yearly from a $425 base); written disclosure required
After repossession: 10 days to claim belongings; Article 9 sale; surplus to you; deficiency allowed
Vehicle sales tax: 5% state (through 2029) plus local tax, on the price minus trade-in
Regulator: Louisiana Motor Vehicle Commission; Office of Financial Institutions

How much interest a Louisiana car contract can carry

When a dealer sells you a car on credit, the retail installment contract falls under the Motor Vehicle Sales Finance Act (La. R.S. 6:969.1 and the sections that follow). R.S. 6:969.10 sets the maximum credit service charge by vehicle class.

Louisiana maximum credit service charge on consumer credit sales of motor vehicles (R.S. 6:969.10), shown for 2026 sales
Vehicle	Ceiling per year
Class 1: new, 2026 model year or later	18%
Class 2: other new cars; used 2024 to 2026 models	24%
Class 3: used 2022 or 2023 models	27%
Class 4: used 2021 models or older	33%

One exception matters. Under R.S. 6:969.11, a contract that the dealer assigns within 35 days to a licensed lender may carry the rate that lender could charge on a direct consumer loan, which can be higher on smaller balances. Either way, a ceiling is a limit and not a fair price, so check any offer with the car payment calculator.

Fees and taxes on a Louisiana purchase

Dealer documentary fee. The fee for titling, compliance and paperwork started from a $425 base. Since January 1, 2026, it is adjusted each year, and the Louisiana Motor Vehicle Commission set the 2026 maximum at $436.
Required disclosure. A dealer that charges it must state the amount in writing on the bill of sale, buyer's order or contract, with a notice that the fee is authorized by R.S. 6:969.18(A)(2) and is not a mandatory state fee.
Lender fees. The lender may add a documentation fee of up to $35. Notary fees in one transaction may not exceed $15 in total.
Sales tax. The state rate rose from 4.45% to 5% on January 1, 2025, and is set to stay there through December 31, 2029. Parish and city taxes are added.
Trade-in. A qualifying trade-in reduces the taxable price, but the credit cannot exceed the price of the car you are buying.

What happens if you fall behind in Louisiana

Louisiana has no statute that gives you a cure notice and a set time to catch up. Instead, the Additional Default Remedy law (R.S. 6:965 and 6:966) controls when a lender may take the car without a court order.

The trigger. For self-help repossession, default means missing two payments in a row. If your payments are due more often than monthly, it means 60 days without payment.
The warning letter. The lender must first send you a written notice saying that Louisiana law permits repossession after default without further notice or court action.
Repossession. The agent may take the car only without a breach of the peace. Otherwise the lender must go to court, for example through executory process.
Your belongings. You have 10 days to ask for personal items left in the car. After 30 days they are treated as abandoned.
Sale and balance. The lender sells the car under the Article 9 rules, must account to you for any surplus and may pursue a deficiency.

Ask the lender in writing for the payoff amount and the date of any sale. Our guides on repossession and deficiency balances explain your options at each step.

Where to check a lender and complain

The Motor Vehicle Sales Finance Act gives the Louisiana Motor Vehicle Commission the power to license consumer lenders that buy car contracts, investigate complaints and fine violators. Banks and other lenders licensed by the Office of Financial Institutions answer to that office.

Louisiana Motor Vehicle Commission

Licenses consumer lenders that buy car contracts under the sales finance act, publishes the yearly doc fee maximum and takes complaints.

Office of Financial Institutions

Supervises state-chartered banks and other lenders it licenses.

Consumer Financial Protection Bureau

Takes complaints about any auto lender or servicer, including banks and finance companies.

Questions people ask

What is the maximum interest rate on a dealer car loan in Louisiana?

18% a year on a new car of the current model year, 24% on other new cars and recent used cars, 27% on used cars three or four model years old, and 33% on older used cars. A contract assigned within 35 days to a licensed lender may use that lender's loan rates.

How much can a Louisiana dealer charge for a doc fee in 2026?

Up to $436, the 2026 maximum published by the Louisiana Motor Vehicle Commission. The dealer must disclose the amount in writing.

Can my car be repossessed in Louisiana after one missed payment?

Not without a court. Self-help repossession requires two consecutive missed payments and an earlier written warning. See what to do when you fall behind.

What is the sales tax on a car in Louisiana?

The state rate is 5% through 2029, plus parish and city taxes, on the price after a qualifying trade-in.

Sources

Facts on this page were checked against these sources on October 26, 2026. The doc fee maximum is reset each year by the Louisiana Motor Vehicle Commission.