Mississippi Car Loan Laws

Mississippi ties the legal rate on a car contract to the vehicle's age, caps dealer doc fees at $425, and gives no right to cure before repossession.

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

In short

Mississippi's Motor Vehicle Sales Finance Law caps the yield on a car contract at 18% a year for a new current or last-year model, rising to 28.75% for used cars more than four years old. The Motor Vehicle Commission caps the dealer document fee at $425. Cars and light trucks carry 5% sales tax on the price after your trade-in. State law gives no right to cure, so a lender can repossess after a default. The Department of Banking and Consumer Finance licenses sales finance companies.

Right to cure: None in state law
Rate ceiling: 18% to 28.75% by age
Doc fee limit: $425
Vehicle sales tax: 5% on cars

Map of the United States with Mississippi highlighted

Mississippi car-finance rules at a glance

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

Right to cure: None in state law; the contract defines default
Rate ceiling: 18% new; 21% to 28.75% on used cars by age; Miss. Code 63-19-43 names licensed dealers and any lender making purchase money vehicle loans under the chapter.
Doc fee limit: $425 under Motor Vehicle Commission Regulation 8.1; Must be itemized, charged to all buyers and shown with a notice that it is not an official fee; current regulation, 2026.
After repossession: Notice before sale; you may redeem; deficiency allowed
Vehicle sales tax: 5% on cars and light trucks, minus trade-in; 3% on heavy trucks; Annual county ad valorem tax is also due at registration.
Regulator: Department of Banking and Consumer Finance (DBCF)

How much interest a Mississippi car contract can carry

Section 63-19-43 of the Mississippi Code sets the most a lender or licensed dealer may earn on a retail installment contract or purchase money loan for a car. The limit is an annual percentage rate figured by the actuarial method, and it climbs as the vehicle gets older.

Mississippi maximum annual percentage rates on motor vehicle financing (Miss. Code 63-19-43)
Class	Vehicle	Ceiling
Class 1	New, made in the year of sale or the year before	18%
Class 2	Other new cars; used cars made no more than 2 years before the sale	21%
Class 3	Used cars made no more than 4 years before the sale	26.75%
Class 4	Used cars more than 4 years old	28.75%

The ceiling also binds lenders that are exempt from licensing but must follow the chapter. It is a limit, not a typical price: with fair or good credit you should expect far less. Test the monthly cost of a rate with the car payment calculator before you sign.

Fees and taxes on a Mississippi car purchase

Document or service fee. Motor Vehicle Commission Regulation 8.1 limits it to $425. It must be listed as a separate charge with its exact amount, charged to every buyer, and shown with a bold notice that it is not an official fee and is not required by law.
What the fee cannot cover. The dealer may not fold in the cost of preparing the installment contract, recording the lien or any finance charge.
Sales tax. Cars and trucks up to 10,000 pounds are taxed at 5%: a 3% base rate plus an extra 2% on passenger and light carrier vehicles (Miss. Code 27-65-17). The tax applies to the price minus your trade-in.
Yearly property tax. When you register the car, you also pay a county ad valorem tax based on the local millage rate.

Falling behind on a car loan in Mississippi

Mississippi has no statute that requires a lender to warn you and give you time to catch up before it repossesses. Your contract sets out what counts as default. From there, the Uniform Commercial Code, Article 9, in Title 75 of the Mississippi Code, controls repossession and resale.

Taking the car. The lender may repossess without a court order if it does so without a breach of the peace (Miss. Code 75-9-609).
Notice before the sale. The lender must send you a written notice of how and when it will dispose of the car (Miss. Code 75-9-611).
Redemption. Until the sale, you can get the car back by paying the full debt plus the lender's reasonable expenses (Miss. Code 75-9-623).
Deficiency. If the sale price falls short of the balance and costs, the lender can pursue you for the rest.

If you made a payment before entering active military duty, the federal Servicemembers Civil Relief Act requires a court order before repossession. Our guides to repossession and falling behind on payments cover what to do next.

Where to check a lender and complain

The Nonbank Division of the Department of Banking and Consumer Finance licenses and supervises motor vehicle sales finance companies under the Motor Vehicle Sales Finance Law. Banks and credit unions have their own regulators, and the federal consumer bureau accepts complaints about any auto lender.

Department of Banking and Consumer Finance

Licenses sales finance companies under Miss. Code 63-19-1 and following; main line 601-321-6901.

Mississippi Motor Vehicle Commission

Licenses dealers it oversees and sets the document fee rule in Regulation 8.

Consumer Financial Protection Bureau

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

Questions people ask

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

It depends on the vehicle: 18% for a new current or last-year model, 21% for newer used cars, 26.75% for used cars up to four years old and 28.75% for older ones.

How much can a Mississippi dealer charge for a document fee?

Up to $425 under Motor Vehicle Commission Regulation 8.1. The fee must be itemized and charged to every buyer.

What is the sales tax on a car in Mississippi?

5% on cars and light trucks, applied to the price after your trade-in. Heavier trucks are taxed at 3%.

Do I get a warning before repossession in Mississippi?

Not under state law. The lender can repossess after a default, but it must send notice before it sells the car.

Sources

Facts on this page were checked against these sources on October 26, 2026.