What is a funder legally required to tell you before you sign?

Small-business borrowing has never had the disclosure regime consumer borrowing has. Truth in Lending covers a consumer credit card; it does not cover a $60,000 advance against your receivables.

That gap is why offers in this market were historically quoted as a daily payment and a factor rate — two numbers that are almost impossible to compare between funders, and that conceal the total cost rather than stating it.

States began closing the gap themselves. California legislated in 2018 and New York followed, and a dozen or so states now have a law of some kind on the books, with more introduced each session.

The amount financed, and separately the funds you actually receive — those differ whenever fees are deducted from the advance, and the gap between them is the number people most often miss.

The finance charge, in dollars. The total cost of the money, stated as money.

The total repayment amount, the payment amount, and how often it is taken.

The term, or the estimated term where repayment moves with your sales.

Prepayment terms — specifically whether repaying early reduces what you owe. On a fixed factor rate it does not, and this is where you find that out in writing.

In California and New York, an estimated annual percentage rate, which is the figure that makes an advance comparable to a loan.

If you are in a covered state, ask for the disclosure before you sign and read the total repayment figure first. A funder that is reluctant to produce it is telling you something.

The disclosure is also the fastest way to compare two offers honestly. Same format, same items, so total against total and term against term.

New York's rule reaches brokers too, not only funders: a broker must pass on the funder's unaltered disclosure before communicating a specific offer, and must tell you in writing how and by whom it is being paid. That last part is worth asking for anywhere, covered state or not.

If your state is not on the list, none of this stops you asking. Every item above is a question a legitimate funder can answer in a sentence.

It is not legal advice, and it is deliberately not a summary of what each state's law says. Effective dates, thresholds and the exact disclosure set differ by state and change from year to year.

The regulator's own page is the authority in every case, and one is linked for each state above. If the answer matters to a decision you are making, that link is where to go, and a lawyer in your state is better than either of us.

We are a broker, not a lender. We arrange funding and are paid by the funder that writes your deal, so treat this page as a map of what to demand from whoever makes you an offer — including us.