N.Y. Financial Services Law Law 804 – Closed-end commercial financing disclosure requirements
§ 804. Closed-end commercial financing disclosure requirements. A provider, subject to this article, shall provide the following disclosures to a recipient at the time of extending a specific offer for closed-end financing according to formatting prescribed by the superintendent:
Terms Used In N.Y. Financial Services Law Law 804
- Annual percentage rate: The cost of credit at a yearly rate. It is calculated in a standard way, taking the average compound interest rate over the term of the loan so borrowers can compare loans. Lenders are required by law to disclose a card account's APR. Source: FDIC
- Finance charge: The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge. Source: OCC
- Truth in Lending Act: The Truth in Lending Act is a federal law that requires lenders to provide standardized information so that borrowers can compare loan terms. In general, lenders must provide information on Source: OCC
(a) The total amount of the commercial financing, and the disbursement amount, if different from the financing amount, after any fees deducted or withheld at disbursement.
(b) The finance charge.
(c) The annual percentage rate, using only the words annual percentage rate or the abbreviation "APR", expressed as a yearly rate, inclusive of any fees and finance charges that cannot be avoided by a recipient, and calculated in accordance with the federal Truth in Lending Act, Regulation Z, 12 C.F.R. § 1026.22, regardless of whether such act or such regulation would require such a calculation.
(d) The total repayment amount, which is the disbursement amount plus the finance charge.
(e) The term of the financing.
(f) The payment amounts:
(i) for payment amounts that are fixed, the payment amounts and frequency (e.g., daily, weekly, monthly), and, if the term is longer than one month, the average monthly payment amount; or
(ii) for payment amounts that are variable, a full payment schedule or a description of the method used to calculate the amounts and frequency of payments, and, if the term is longer than one month, the estimated average monthly payment amount.
(g) A description of all other potential fees and charges that can be avoided by the recipient, including, but not limited to, late payment fees and returned payment fees.
(h) Were the recipient to elect to pay off or refinance the commercial financing prior to full repayment, the provider must disclose:
(i) whether the recipient would be required to pay any finance charges other than interest accrued since their last payment. If so, disclosure of the percentage of any unpaid portion of the finance charge and maximum dollar amount the recipient could be required to pay; and
(ii) whether the recipient would be required to pay any additional fees not already included in the finance charge.
(i) A description of collateral requirements or security interests, if any.