Foundational pillar / check financing-cost-disclosure-cues
Cost-of-capital context near advertised rates
When a financing site advertises rates or factor rates, checks for total-cost or APR context so advertised numbers do not contradict offer-time disclosures.
By Shimon Carroll, Founder, SEO for AI Agents · Last updated
What this check measures
Pricing claims (factor rates, "rates as low as", "low rates", "no hidden fees", percentage rates) and, when present, cost context such as "APR", "annual percentage rate", "total cost", "total repayment", or "cost of capital".
Why it matters
State commercial-financing disclosure laws, such as New York’s (23 NYCRR 600), require cost disclosures including an estimated APR for sales-based financing when a provider makes a specific offer. Those rules attach to the offer, not the website, but an advertised rate that the offer contradicts is a deception risk under the FTC Act.
How we score it
A review prompt, not a legal verdict. Runs only on merchant cash advance audits. When the cue is missing the finding is low severity at low confidence, which lowers the foundational pillar by about 0.3 points. A pass is informational and never scores. Pages without pricing claims are not evaluated. In that case the finding is marked not measured: it does not score and does not count toward coverage. Each finding names who should review it, quotes what we saw on the page, and cites the primary source. Where the page shows a US address we name the inferred state; otherwise the wording is state-agnostic.
Confidence-flag rules
LOW: pricing and cost phrases are matched in visible text only; whether an advertised number is consistent with your offers needs a human review.
Common mistakes
- Advertising a factor rate as if it were an interest rate.
- "No hidden fees" copy alongside fees that appear only in the contract.
- Rates on the site that were never updated after pricing changed.
How to fix it
Where the site quotes a rate or factor rate, explain that the offer shows the total cost and, where state law requires it, an estimated APR. Keep advertised numbers consistent with offer-time disclosures, and have counsel review.
Primary sources
- 23 NYCRR 600.1, New York Commercial Finance Disclosure, Definitions
Legal Information Institute (New York Codes, Rules and Regulations)
- 15 U.S.C. 45, Unfair methods of competition; unfair or deceptive acts or practices
Legal Information Institute (U.S. Code)
Changelog
- · New. This rule used to live only in the vertical configuration and never ran. It is now a registered review check with a cited primary source, framed as a prompt to review with a professional rather than a pass or fail legal verdict.