Lenders

TRADE PRACTICES DIVISION
DEPARTMENT OF GOVERNMENT SERVICES
5 MEWS PLACE
PO BOX 8700
ST. JOHN'S NL  A1B 4J6
CANADA

Other Locations and Contact Numbers

Contents

1. What is a Lender
2. How to become registered as a Lender
3. What a Lender should know
4. What a Borrower should know
5. Consumer Protection Links
6. Consumer Protection Forms, Pamphlets and Information

What is a Lender

A Lender means a person who extends credit.

Credit includes:

• an agreement between a seller and a buyer to purchase goods or services by which all or part of the purchase price is payable after the agreement in entered into;
• given by advancement of money.

Credit does not include:

• security of a mortgage on real property;
• sale of goods intended for resale;
• for industrial purposes or business purposes of the borrower;
• loans made by insurance companies to policyholders solely on the security of the cash surrender values of the policies.

How to become registered as a Lender

Before operating in Newfoundland and Labrador a business entity wishing to provide the services of a Lender, where applicable must comply with the following:

• complete a Lender Application (PDF: 103 KB), please note there is no fee to register;
• if the business entity is a corporation, be in good standing as a company. If the corporation is outside Newfoundland and Labrador then it must be registered as an extra provincial corporation in this province. Please refer to the Registry of Companies for more information;
• have an address for service in the Province where a document sent or served under the Act shall be considered to be sufficiently given or served if delivered or sent by registered mail to the person at the address for service stated in the application for registration;
• submit with the application, a copy of all forms to be used when a borrower is required to pay official fees, interest charges, or any other charges, contingent on or pertaining to granting of credit.

What a Lender should know

Registration remains in effect until it is withdrawn by the registered Lender or is suspended or cancelled under the Act.

A Lender shall:

• within 5 days of the change, notify the registrar in writing of a change of the lender’s address for service;
• in accordance with Section 16. (1) of the Act, provide to the borrower before extending the credit a clear statement in writing showing:
• in the case of credit given by the advancement of money, the sum actually received by the borrower, plus official fees and premiums for insurance paid or payable by the lender;
• in the case of goods or services, the cash price of the goods or services;
• where the lender is a seller, the amount credited as a down-payment or in the respect of a trade-in or in respect of another matter and the amount that is owing;
• the cost of borrowing expressed as one sum in dollars and cents;
• the percentage of the cost of borrowing expressed as an annual rate of the unpaid balance in compliance with the Regulations
• the basis upon which additional charges are to be made in the event of default.
• where the lender is extending variable credit, in accordance with Section 16. (2) of the Act, provide to the borrower before extending the credit a clear statement in writing showing:
• the cost of borrowing as an annual percentage or a scale of annual percentages that the borrower is required to pay monthly or periodically on the unpaid balance;
• expressed in dollars and cents in a schedule of amounts of outstanding balances and corresponding charges for the cost of borrowing;
• not less frequently than every 5 weeks during the extension of credit, provide the borrower with a clear written statement showing;
• the outstanding balance in the account at the beginning of the period;
• the amount of each extension of credit to the borrower during the period and the date of it;
• the total sum received from or credited to the account of the borrower during the period;
• the cost of borrowing, expressed as one sum in dollars and cents, charged during the period;
• the outstanding balance in the account for the borrower at the end of the period;
• a statement of the terms of the borrowing.
• disclose the cost of borrowing in the manner described in Section 16. of the Act when the lender represents in an oral statement, printing, broadcasts or other publication.

What a Borrower should know

The lender must provide you with a statement in compliance with Section 16. of the Act outlining the terms of the credit, that includes but is not limited to:

• the amount;
• interest rate;
• frequency of payment;
• any fees that you have to pay or that they will pay on your behalf;
• date of payments;
• insurance costs.

If you have variable credit, something similar to a charge card or account, the lender must provide you with a statement at least every 5 weeks showing:

• your opening balance;
• the amount of purchases or extensions of credit during the period;
• the total amount of payment or credits
• the interest charged;
• the closing balance;
• the terms of the account, this may include the payment due date and the interest rate.

If you are dealing with a lender regarding your loan or account and you feel that the Lender is violating the Consumer Protection Act or Regulations you should contact the supervisor/manager of the Lender in question and express your concerns about the way you are being treated. In the event that the matter cannot be resolved between you and the lender, we suggest you file a complaint with us. The complaint has to be registered by the person owing the debt. We cannot mediate third party complaints or legal cases where the complaint is in the process of court action. To register a complaint on line, please complete our On-Line Lender Complaints Form or to mail or fax your complaint, please download the Complaint Record Form (PDF: 92 KB).

We do not advise consumers or offer counselling on financial issues. For information pertaining to credit counselling you may refer to the yellow pages of the telephone directory

Consumer Protection Links

Consumer Protection Forms, Pamphlets and Information

• Consumer Protection Act
• Consumer Protection Regulations
• Lender Application (PDF: 103 KB)
• Lender Registration Procedure (PDF: 89 KB)
• Complaint Record Form (PDF: 92 KB)
• Frequently Asked Questions

If you still haven’t found the information you are looking for, please Contact our office.