Skip to content
Oakclause

Usury Laws in Iowa

Iowa sets a 5% legal rate and caps written interest at a monthly maximum equal to 2 points above the 10-year Treasury average, set by the superintendent of banking.

Last checked . General information, not legal advice.

Iowa at a glance

Maximum agreed rate
10-year Treasury average plus 2 points
Published monthly by the superintendent of banking. Business, agricultural, real estate and larger consumer loans may carry any agreed written rate.
Legal rate (no rate agreed)
5%
Applies to money loaned or due when the parties did not agree in writing on a rate.

Sources

Last checked

The rules in Iowa

What is the maximum interest rate on a private loan in Iowa?

Maximum agreed rate in Iowa: 10-year Treasury average plus 2 points. Published monthly by the superintendent of banking. Business, agricultural, real estate and larger consumer loans may carry any agreed written rate.

What interest rate applies in Iowa when no rate was agreed?

Legal rate (no rate agreed) in Iowa: 5%. Applies to money loaned or due when the parties did not agree in writing on a rate.

Where do the Iowa usury laws come from?

The rules above come from Iowa Code 535.2, Iowa Code 535.4 and Iowa Code 535.5. Each source is linked on this page. We last checked them in October 2026.

Good to know

A usurious lender recovers only the unpaid principal, without costs, and forfeits 8% a year on the unpaid principal to the state (Iowa Code 535.5).

What this means in practice

Put the interest rate in writing. Many usury statutes set one limit for written agreements and a different, often lower, rate when nothing was agreed in writing. A signed promissory note or loan agreement that states the rate, the payment schedule and what happens on late payment avoids most disputes.

Count every charge, not only the stated rate. Courts may treat fees, points, required extras or a discount taken from the amount lent as interest when deciding whether a loan is usurious. A loan with a modest rate and large fees can still cross the limit.

Check who the lender is and what the loan is for. Usury limits often do not apply, or apply differently, to banks, licensed consumer lenders, credit card issuers, larger loans and loans to businesses or corporations. A rule written for loans between individuals may not cover your situation, so read the statute and its exceptions.

General information, not legal advice. Laws change, and cities can add their own rules, so check the current statute before you rely on it.