CHANGES IN CIRCUMSTANCES
Amendments to Credit Agreements
13. (1) Subject to subsection (2), if a credit agreement is amended, the retail association must, not later than 30 days after the day on which the amendment is made, disclose in writing to the borrower any resulting changes to the information that was required to be disclosed in the initial disclosure statement.
(2) If a credit agreement for a fixed amount has a schedule for instalment payments and the schedule is amended, the retail association must, not later than 30 days after the day on which the amendment is made, disclose in writing to the borrower the amended payment schedule and any increase in the total amount to be paid or in the cost of borrowing as a result of that amendment.
- SOR/2009-261, s. 8.
Renewals of Mortgages or Hypothecs
14. (1) If a credit agreement for a loan secured by a mortgage or hypothec is to be renewed on a specified date, the retail association must, at least 21 days before the date, provide the borrower with a subsequent disclosure statement that contains the information required to be disclosed by
(a) section 8, if the credit agreement is for a fixed interest rate; or
(b) section 9, if the credit agreement is for a variable interest rate.
(2) The subsequent disclosure statement referred to in subsection (1) must specify that
(a) no change that increases the cost of borrowing will be made to the credit agreement between the transmission of the subsequent disclosure statement and the renewal of the credit agreement; and
(b) the borrower’s rights under the credit agreement continue, and the renewal does not take effect, until the day that is the later of the date specified for its renewal and 21 days after the borrower receives the statement.
(3) A retail association that does not intend to renew a credit agreement for a loan secured by a mortgage or hypothec after its term ends shall, at least 21 days before the end of the term, notify the borrower of that intention.
Waiver of Payments
15. (1) If a retail association, under a credit agreement for a loan for a fixed amount, waives a payment without waiving the accrual of interest during the period covered by the payment, the retail association must, in an offer to make such a waiver, disclose in a prominent manner that interest will continue to accrue during that period if the offer is accepted.
(2) If a retail association offers to waive a payment under a credit agreement for a line of credit or a credit card, the retail association must, with the offer, disclose in a prominent manner whether interest will continue to accrue during any period covered by the offer if the offer is accepted.
Cancellation of Optional Services
16. (1) A disclosure statement made in relation to a credit agreement under which optional services, including insurance services, are provided on an on-going basis must specify that
(a) the borrower may cancel the optional service by notifying the retail association that the service is to be cancelled effective as of the day that is the earlier of one month after the day that the disclosure statement was provided to the borrower, determined in accordance with subsection 6(6), and the last day of a notice period provided for in the credit agreement; and
(b) the retail association shall, without delay, refund or credit the borrower with the proportional amount, calculated in accordance with the formula set out in subsection (2), of any charges for the service paid for by the borrower or added to the balance of the loan, but unused as of the cancellation day referred to in the notice.
(2) The proportion of charges to be refunded or credited to a borrower shall be determined in accordance with the formula
R = A × ((n- m) / n)
- is the amount to be refunded or credited;
- is the amount of the charges;
- is the period between the imposition of the charge and the time when the services were, before the cancellation, scheduled to end; and
- is the period between the imposition of the charge and the cancellation.
(3) Subsection (1) is subject to any provincial laws that apply to the cancellation of services that are referred to in that subsection.
- Date modified: