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Cost of Borrowing (Banks) Regulations

Version of section 6 from 2010-01-01 to 2011-05-31:

  •  (1) For the purpose of subsection 450(1) of the Act, a bank that grants credit must, in writing, provide the borrower with a disclosure statement that provides the information required by these Regulations to be disclosed.

  • (2) A disclosure statement may be a separate document or may be part of a credit agreement or an application for a credit agreement.

  • (2.1) For a disclosure statement that is part of a credit agreement in respect of a loan, a line of credit or a credit card or an application for a credit card,

    • (a) the disclosure statement must be presented in a consolidated manner in a single location in that agreement or application; and

    • (b) the applicable information box, as set out in one of Schedules 1 to 5, containing the information referred to in that Schedule, must be presented at the beginning of the agreement or application.

  • (2.2) For a disclosure statement that is separate from the credit agreement or the application,

    • (a) the disclosure statement must be provided before entering into the agreement or together with the agreement or the application; and

    • (b) the applicable information box, as set out in one of Schedules 1 to 5, containing the information referred to in that Schedule, must be presented at the beginning of the disclosure statement.

  • (2.3) Numbers that are set out in the information box, including numbers that refer to an interest rate, a time period, a date or a dollar amount, are not required to be repeated in the disclosure statement but may instead be referenced in it.

  • (2.4) In order to maximize its legibility, the information in the information box must be presented with

    • (a) text in an easily readable font style and font size of at least

      • (i) 12 points, with bold font for titles and numbers, including numbers that refer to an interest rate, a time period, a date or a dollar amount, and

      • (ii) 10 points for any other text;

    • (b) standard spacing between words and characters, such that the text does not appear to be in a font smaller than a 10-point font;

    • (c) sufficient margins above, below and to either side of the text such that sufficient white space is provided around the text; and

    • (d) dark text on a light background in order to maximize the contrast so that the text is clearly visible.

  • (3) Information disclosed in a disclosure statement may be based on an assumption or estimate if the assumption or estimate is reasonable and the information disclosed by it

    • (a) cannot be known by the bank when it makes the statement; and

    • (b) is identified to the borrower as an assumption or estimate.

  • (4) Any disclosure that is required to be made by a bank under these Regulations must be made in language, and presented in a manner, that is clear, simple and not misleading.

  • (5) If the borrower consents, in writing, the disclosure statement may be provided by electronic means in an electronic form that the borrower can retrieve and retain.

  • (6) A disclosure statement that is sent to the borrower by mail is considered to be provided to the borrower on the fifth business day after the postmark date.

  • SOR/2009-258, s. 2

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