6.1 (1) Subject to subsections (2) and (3), if a retail association enters into a credit agreement with two or more borrowers, it must provide the disclosure statement referred to in subsection 6(1) to all of the borrowers.
(2) If all of the borrowers have consented, orally or in writing, in paper or electronic form, to the provision of the disclosure statement to one of the borrowers on their behalf, the retail association must provide the statement to that borrower.
(3) If two or more but not all of the borrowers have consented, orally or in writing, in paper or electronic form, to the provision of the disclosure statement on their behalf to one of the consenting borrowers, the retail association may provide the statement to that borrower on their behalf, if it also provides the statement to every borrower that has not so consented.
(4) If the consent referred to in subsection (2) or (3) is given orally by a borrower, the retail association must, without delay, provide confirmation of that consent to the borrower in writing, in paper or electronic form.
- SOR/2009-261, s. 3.
Timing of Initial Disclosure
7. (1) A retail association that proposes to enter into a credit agreement with a borrower must provide the borrower with the initial disclosure statement required by these Regulations on or before the earlier of the making of a payment, other than a disbursement charge, in relation to the credit agreement by the borrower and
(a) two clear business days before the entering into the credit agreement by the borrower and the retail association, in the case of a credit agreement for a mortgage or hypothec; or
(b) the entering into the credit agreement by the borrower and the retail association, in any other case.
(2) Paragraph (1)(a) does not apply if
(a) the borrower consents to being provided with the initial disclosure statement for the credit agreement in accordance with paragraph (1)(b);
(b) the borrower obtains independent legal advice;
(c) a rescission period is provided in the credit agreement; or
(d) favourable terms, such as imposing no penalty or fee for early payment, are provided in the credit agreement.
- SOR/2009-261, s. 4.
DISCLOSURE — CONTENT
Fixed Interest Loans for a Fixed Amount
8. (1) A retail association that enters into a credit agreement for a loan for a fixed interest rate for a fixed amount, to be repaid on a fixed future date or by instalment payments, must provide the borrower with an initial disclosure statement that includes the following information:
(a) the principal amount of the loan;
(b) the amount of the advance, or any advances, of the principal and when it is, or they are, to be made;
(c) the total amount of all payments;
(d) the cost of borrowing over the term of the loan, expressed as an amount;
(e) the term of the loan, and the period of amortization if different from the term;
(f) the annual interest rate and the circumstances under which it is compounded, if any;
(g) the APR, when it differs from the annual interest rate;
(h) the date on and after which interest is charged and information concerning any period during which interest does not accrue;
(i) the amount of each payment and when it is due;
(j) the fact that each payment made on a loan must be applied first to the accumulated cost of borrowing and then to the outstanding principal;
(k) information about any optional service in relation to the credit agreement that the borrower accepts, the charges for each optional service and the conditions under which the borrower may cancel the service if that information is not disclosed in a separate statement before the optional service is provided;
(l) the disclosure required by paragraph 385.18(1)(a) of the Act, including a description of any components that comprise a formula to calculate a rebate, charge or penalty in the event that the borrower exercises the right to repay the amount borrowed before the maturity of the loan and, if section 17 applies, the formula set out in subsection 17(4);
(m) the disclosure required by paragraph 385.18(1)(b) of the Act, including default charges that may be imposed under section 18;
(n) the property, if any, over which the retail association takes a security interest under the credit agreement;
(o) any charge for a broker, if the broker’s fees are included in the amount borrowed and are paid directly by the retail association to the broker;
(p) the existence of a fee to discharge a security interest and the amount of the fee on the day that the statement was provided; and
(q) the nature and amount of any other charge, other than interest charges.
(2) If the missing of a scheduled instalment payment or the imposition of a default charge for a missed scheduled instalment payment increases the outstanding balance of a loan referred to in subsection (1) with the result that each subsequently scheduled instalment payment does not cover the interest accrued during the period for which it was scheduled, the retail association must, at most 30 days after the missed payment or the imposition of the default charge, provide the borrower with a subsequent disclosure statement that describes the situation and its consequences.
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