What must a lender or broker disclose before I sign?

Eleven states require a written cost disclosure before a business signs certain financing: California, New York, Utah, Virginia, Georgia, Florida, Connecticut, Kansas, Missouri, Louisiana and Texas. Each one makes the provider, and sometimes the broker, show you what you receive, what you repay and how payments work. Two of them, California and New York, also require an annual percentage rate.

These laws exist because business financing sits outside the federal Truth in Lending Act, which protects consumers. Without them, a merchant cash advance could be quoted only as a factor rate, which hides the real cost.

The eleven states at a glance

Thresholds and dates come from the law firm summaries and bill text listed in the sources. Banks and credit unions are exempt in most of these states, and most exempt real estate secured deals.

The two APR states

California. California's Commercial Financing Disclosures Law, created by SB 1235, covers offers of $500,000 or less. Hudson Cook's analysis on deBanked explains that the law calls both funders and brokers "providers", so a broker who presents a specific offer can owe you the disclosure. The form shows the amount financed, the total cost, the APR or estimated APR, the payment amount and frequency, the term and the prepayment policy.

SB 362 added two rules from January 1, 2026. A provider may not use the word "rate" or "interest" in a way likely to mislead, which in practice ends quoting a "factor rate" to a California business. And once you have a specific offer, every time the provider states a charge or pricing metric during the application, it must also state the APR. That applies in online portals, calls and texts too. Our California guide covers the 2028 broker licence as well.

New York. Venable reports that New York's Commercial Finance Disclosure Law took effect August 1, 2023 and covers financing up to $2,500,000, the highest threshold in the country. The disclosure includes the total amount financed, the finance charge, the APR, the estimated term, the total repayment, the payment amount and frequency, other potential fees, prepayment charges and any collateral requirements. You sign the disclosure before the application moves forward. New York's rules also tie brokers and funders to the APR when pricing is discussed after an offer, according to Hudson Cook.

The dollar cost states

The other nine states require costs in dollars and payment terms rather than an APR.

Utah. Manatt reports that Utah providers must disclose the total funds provided, the amount disbursed if less, the total to be repaid, the total dollar cost, payment details, how variable payments are calculated, prepayment costs and any amount paid to a broker out of your funds.

Virginia. Mayer Brown reports that Virginia's sales-based financing disclosure includes the financing and disbursement amounts, the finance charge, the total repayment, the estimated number of payments, the payment amount and frequency, other fees, prepayment terms, collateral and any broker compensation. Virginia also voids confession of judgment clauses in these contracts.

Connecticut. Greenberg Traurig lists the total financing amount, disbursement amount, finance charge, total repayment, payment schedule, prepayment charges, other fees, collateral, broker compensation and payoff amounts for any existing financing from the same provider. Connecticut is the one state in this group where brokers carry their own disclosure duty, alongside registration.

Texas. HB 700 requires providers to disclose eleven items on specific offers under $1,000,000, including the finance charge, total repayment, estimated term, fees outside the finance charge, early payoff charges, collateral, and whether and how much the provider pays the broker. You sign the disclosure before the application is finalized. Texas also bars automatic debits unless the provider holds a perfected first priority security interest. Read the Texas guide for the registration side.

Georgia. Mayer Brown reports that Georgia providers disclose the total funding, the net funds disbursed, the total repayment, the dollar cost of financing, the payment schedule and any prepayment penalties. Brokers have no disclosure duty but may not take advance fees or make false or misleading statements.

Florida. Florida's disclosure mirrors Georgia's. Mayer Brown notes that Florida brokers may not collect advance fees beyond bona fide third party costs, may not make misleading representations and must include their address and phone number in advertising.

Kansas. Greenberg Traurig reports Kansas requires the funds provided and disbursed, total payments, the total dollar cost, payment amount and frequency, and any prepayment costs or discounts. There is no broker registration.

Missouri. Missouri's list, per Mayer Brown, is the funds provided, the amount disbursed, the total of payments, the total dollar cost, the payment amounts and any prepayment costs or discounts. Missouri is also the state that registers brokers and requires a $10,000 bond.

Louisiana. Mayer Brown reports that Louisiana's HB 470 requires disclosures for revenue-based financing of any size, with no dollar cap and no entity exemptions, covering funds provided and disbursed, total repayment, total dollar cost, the payment method and any prepayment costs.

How to use a disclosure

A disclosure is the cleanest way to compare offers your broker brings. Put each one side by side and look at three lines:

1. Funds disbursed. This is what lands in your account after fees. It is often less than the headline amount.
2. Total repayment and total dollar cost. This is the real price of the money.
3. Estimated term and payment frequency. A short term with daily payments can make a modest dollar cost feel heavy on cash flow.

Where an APR is shown, use it to compare products of different lengths. Our guide to APR vs factor rate explains why the two numbers can look so different.

If your state has no disclosure law, ask for the same lines anyway. Verified entries on the register show fees in writing, and you can check a broker's standing before you share documents.