Rates of Interest
Announcement of Maximum Effective Formula Rate of Interest
July 15, 2025
NASHVILLE--Tennessee Department of Financial Institutions Commissioner Greg Gonzales announced today that the maximum effective formula rate of interest in Tennessee is 11.50 percent per annum.
The rate is based on a ceiling of 4 percent over the weekly average prime loan rate of 7.50 percent as published by the Federal Reserve on July 14, 2025.
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.
Announcement of Maximum Effective Rate of Interest on Home Loans
The Commissioner of Financial Institutions hereby announces that the maximum effective rate of interest per annum for home loans as set by the General Assembly in 2025, Public Chapter 290, for the month of August 2025 is 10.67 percent per annum.
The maximum effective rate of interest per annum for home loans shall be set at an amount equal to four (4) percentage points above the average prime offer rate (APOR), as defined in 12 CFR 1026.35, that applies to a thirty-year fixed loan, as published by the Federal Financial Institutions Examination Council (FFIEC), or its successor federal entity. For the most recent APOR statistical data available preceding the date of this announcement, the calculated rate is 6.67 percent.
Persons affected by the maximum effective rate of interest for home loans as set forth in this notice should consult legal counsel as to the effect of the Depository Institutions Deregulation and Monetary Control Act of 1980 (P.L. 96-221 as amended by P.L. 96-399) and regulations pursuant to that Act promulgated by the Federal Home Loan Bank Board. State usury laws as they relate to certain loans made after March 31, 1980, may be preempted by this Act.