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Consumer Protection Laws

Sample Disclosure Statement

What is a Disclosure Statement?
A disclosure statement shows you how much it will cost to borrow money.

What Do I Look for on a Disclosure Statement?
Two of the most important terms to compare on disclosures are:

  • The finance charge
  • Annual percentage rate, or APR

The finance charge is the total dollar amount you pay to use credit.

The annual percentage rate (APR) is the percentage cost of credit on a yearly basis.

When shopping for the best deal, pay careful attention to these costs. Ask for a written disclosure from credit lenders. Under the Truth in Lending Act, credit lenders are required to tell you how much it will cost to borrow money.

What Does a Disclosure Statement Look Like?
This disclosure statement shows how much it will cost to borrow $5,000.00:

Annual Percentage Rate
The cost of your credit as a yearly rate.

 Finance Charge
The dollar amount the credit will cost you.		 Amount Financed
The amount of credit provided to you or on your behalf.		 Total of Payments
The amount you will have paid when you have made all scheduled payments.
12%
$675.31
$5,000.00
$5,675.31

For more information on TILA, or the Truth in Lending Act, visit the “Truth in Lending Act” section of the Information Booth (under “Consumer Protection Laws”).