Financial Consumer Protection Framework Regulations — 41
Initial disclosure — variable interest loan 41 (1) For the purposes of paragraph 627.89(1)(e) of the Act, the following information is prescribed information in relation to a variable interest rate loan for a fixed amount that is to be repaid on a fixed future date or by instalment payments: (a) the information referred to in subsection 40 (1) of these Regulations; (b) the annual interest rate that applies on the date of the disclosure; (c) the method for determining the annual interest rate and when that determination is made; (d) the amount of each payment based on the annual interest rate that applies on the date of the disclosure and the dates when those payments are due; (e) the total amount of all payments and of the cost of borrowing based on that annual interest rate; (f) if the loan is to be paid by instalment payments and the amount to be paid is not adjusted automatically to reflect changes in the annual interest rate that apply to each instalment payment, (i) the triggering annual interest rate above which the amount paid under a scheduled instalment payment on the initial principal does not cover the interest due on the instalment payment, and (ii) the fact that negative amortization is possible; and (g) if the loan does not have regularly scheduled payments, (i) the conditions that must occur for the entire outstanding balance, or part of it, to become due, or (ii) the provisions of the credit agreement that set out those conditions. Subsequent disclosure — public index (2) If the variable interest rate for the loan is determined by adding or subtracting a fixed percentage interest rate to or from a public index that is a variable rate, then, for the purposes of subsection 627.89(4) of the Act, the following information is prescribed information: (a) the annual interest rate at the beginning and end of the period covered by the disclosure; (b) the outstanding balance at the beginning and end of the period covered by the disclosure; and (c) the amount of each instalment payment due under a payment schedule and the time when each payment is due, based on the annual interest rate that applies at the end of the period covered by the disclosure. Frequency and manner of disclosure (3) The prescribed information referred to in subsection (2) must be disclosed in a statement that is provided at least once every 12 months. Subsequent disclosure — other method (4) If the variable interest rate for the loan is determined by a method other than the one referred to in subsection (2), then, for the purposes of subsection 627.89(4) of the Act, the following information is prescribed information: (a) the new annual interest rate and the date on which it takes effect; and (b) for payments that are affected by the new annual interest rate, the amount of each instalment payment and the time when each payment is due. Time and manner of disclosure (5) The prescribed information referred to in subsection (4) must be disclosed in a statement that is provided not later than 30 days after the day on which the institution increases the annual interest rate by more than 1% above the most recently disclosed rate.