A growing number of states have rules that require certain disclosures when commercial financing, including some advances, is offered to small businesses.
What these rules usually cover
They often ask the provider to show the merchant key terms in a standard format, such as the total amount, total cost and payment schedule, before the deal is signed.
Who is responsible
In many cases the funder prepares the disclosure, but brokers may have duties too, such as registration in some states. The details vary by state and change over time.
What a broker should do
- Ask each funder how they handle disclosures in the states you work
- Ask your counsel whether you need to register anywhere
- Never rush a merchant past the disclosure
This is general information, not legal advice.
Want live MCA leads? Unlock fresh merchants with credits, straight to your CRM.
Get leads nowRelated
Words to avoid on MCA sales calls and consent and MCA leads.
