Tennessee Maximum Interest Rate Announcement
Summary
The Tennessee Department of Financial Institutions announced the weekly maximum effective formula rate of interest for the state, set at 10.75% per annum. This rate is determined by a formula based on the Federal Reserve's weekly average prime loan rate.
What changed
The Tennessee Department of Financial Institutions (TDFI) has announced the weekly maximum effective formula rate of interest for the state, effective March 17, 2026. The rate is set at 10.75% per annum, calculated as 4% above the weekly average prime loan rate of 6.75% published by the Federal Reserve on March 16, 2026. This announcement is a statutory requirement for the Commissioner of Financial Institutions.
Financial institutions operating in Tennessee should note this updated maximum interest rate. The rate remains in effect until the Federal Reserve's average prime loan rate changes. While this is a routine announcement, it is crucial for lenders to adhere to the maximum rate to ensure compliance with Tennessee law and avoid potential penalties related to usury.
What to do next
- Ensure lending practices adhere to the announced maximum interest rate of 10.75%.
Source document (simplified)
COMMISSIONER GONZALES ANNOUNCES WEEKLY FORMULA RATE MARCH 17, 2026
Tuesday, March 17, 2026 | 08:19am NASHVILLE--Commissioner of Financial Institutions Greg Gonzales announced today that the maximum effective formula rate of interest in Tennessee is 10.75 percent per annum.
The rate is based on a ceiling of 4 percent over the weekly average prime loan rate of 6.75 percent as published by the Federal Reserve on March 16, 2026.
Commissioner Gonzales said the rate remains in effect until the average prime loan rate as announced by the Federal Reserve Bank changes.
Chapter 464, Public Acts of 1983, the legislation regulating interest rates in Tennessee, requires that the commissioner of Financial Institutions make an announcement weekly of the formula rate of interest.
Alica Owen
Public Information Officer
Tennessee Department of Financial Institutions
(615) 289-4738
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