April 8, 2008
New Act Provides Standardized Information on Cost of Borrowing
The Provincial Government has passed legislation which will provide consumers with a standardized disclosure for cost of borrowing whether the borrowing is for a mortgage, loan, credit card or any other type of credit. The new Cost of Credit Disclosure Act was passed in the House of Assembly yesterday.
"This important piece of legislation will be harmonized with the federal Bank Act and with similar legislation in other provinces," said the Honourable Kevin O�Brien, Minister of Government Services. "This will ensure that banks, credit unions and other lenders will exercise the same practice across the country so that a consumer in one province will receive the same information on the cost of borrowing as in another when they obtain credit."
The new Cost of Credit Disclosure Act requires lenders to provide a clear statement, in writing, to the borrower of the cost of credit including the initial sum plus interest rate and, where applicable, the cost of the processing fee for the loan and/or credit. The act was developed by the Consumer Measures Committee which consists of representatives of departments responsible for consumer affairs of all provinces and the Federal Government.
This act will replace the Consumer Protection Act, which will be repealed. Consumers can be assured that the repeal of this act will provide consumers with the same level of protection as safeguards providing consumer protection are included in the Cost of Credit Disclosure Act.
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2008 04 08 12:30 p.m.
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