NJ A4580

Providers of commercial financing in New Jersey must disclose key terms to recipients at the time of extending a specific offer, including the total financing amount, finance charge, annual percentage rate (APR), total repayment amount, payment terms, and any potential fees.

Disclosure requirements apply to multiple financing types: sales-based financing, closed-end financing, open-end financing, and factoring transactions, with specific calculation methods prescribed for each type's APR.

APR calculations must follow federal Truth in Lending Act regulations (12 C.F.R. s.1026.22), with accuracy tolerances of 1/8 to 1/4 of one percentage point depending on transaction complexity.

Brokers who charge fees paid by the financing recipient must provide a separate written disclosure listing all broker fees, the total dollar amount, and any resulting increase to the APR.

The Commissioner of Banking and Insurance is authorized to promulgate regulations establishing the form and manner of disclosures to ensure recipients can easily compare financing options.