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What does a sample disclosure statement look like?

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Quick Answer

Samples of disclosure statements, which commonly refer to lending practices, must include information to the borrower about the annual percentage rate, finance charge, amount lent, and total number of payments of any credit or loan offering, says FindLaw. Such activity is regulated by the Truth in Lending Disclosure Act.

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Full Answer

The act was passed by Congress in 1968 to allow consumers to be able to compare loans before deciding which one to take, according to FindLaw. The items that are mandatory to reveal and need to be included in any sample disclosure statement are factors that let consumers easily figure out the total they are undertaken.

For example, the APR is the interest for the entire year, as opposed to the monthly rate, which is lower and could lead borrowers to induce the debt is less than it actually is, reports FindLaw. The finance charge section of the disclosure sample needs to disclose all the all the charges that are owed the debtor, including fees and balance carried over. The amount financed is the total amount of credit provided by the lender, and the number of payments delineates the specific number of payments made to pay of all the charges, including interest and finance charges. Other items that may be found in a sample disclosure form include information about whether the loan has a variable rate and if there are penalties for early payment.

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