Florida's commercial financing disclosure law and what it shows you

If you took an advance in Florida in 2022 and another one in 2024, pull both agreements and put them side by side. The second one should come with a page the first one does not have.

That page exists because of a law that changed what funders have to put in writing before they take your signature.

What the law is

Florida enacted House Bill 1353 in 2023, creating the Florida Commercial Financing Disclosure Law, codified in Chapter 559, Part XIII of the Florida Statutes, sections 559.961 through 559.9615. The statute took effect July 1, 2023, and it applies to commercial financing transactions consummated on or after January 1, 2024.

It is a disclosure law and nothing more. Florida did not cap what a funder can charge, did not license the industry, and did not make merchant cash advances into loans. It made the price visible at the moment of signing.

Which advances it covers

The law reaches three transaction types when the purpose is commercial: closed end commercial loans, accounts receivable purchase transactions, and commercial open end credit plans. Most merchant cash advances sit in the second bucket, since a typical advance is structured as a purchase of future receivables rather than a loan.

A "provider" under section 559.9611 is a person who consummates more than five commercial financing transactions with a business located in Florida in a calendar year. That definition alone exempts occasional or one off funders.

The duty sits with the provider, not with the broker who brought you the deal. Florida also closed the obvious workaround. Someone who signs a written agreement with a depository institution and arranges financing for a Florida business through an online lending platform is a provider under the statute, even though the bank behind the deal is exempt. Fronting for an exempt lender does not move the duty.

Section 559.9612 carves out a longer list. The law does not apply to:

• Transactions of more than $500,000
• Federally insured depository institutions, and their subsidiaries and affiliates
• Lenders regulated under the federal Farm Credit Act
• Financing secured by real property
• True leases and purchase money obligations
• Motor vehicle dealers, rental companies, and manufacturer affiliated financing
• Licensed money transmitters
• Providers doing five or fewer transactions in Florida in a 12 month period

That $500,000 ceiling matters. A business with a single large facility may get no disclosure at all, and that is the law working as written, not a violation.

The six numbers a Florida disclosure has to show

Section 559.9613 sets out what has to be delivered in writing at or before the transaction closes:

1. Total amount of funds provided under the agreement.
2. Total amount actually disbursed to the business, if it is less than the funded amount, after fees withheld at disbursement, any payoff of a prior balance, and any payment made to a third party on your behalf.
3. Total amount to be paid to the provider under the agreement.
4. Total dollar cost of the financing, which the statute calculates as the difference between the total funds provided and the total you pay back.
5. The manner, frequency, and amount of each payment. Where payments vary with your sales, the disclosure must give the estimated initial amount, the method used to calculate it, and the circumstances that cause it to change.
6. Prepayment terms, meaning whether paying early costs more or saves you money, with a pointer to the contract provision that controls.

Line 2 is the one people skip past. The gap between funds provided and funds disbursed is where origination holds, brokerage points, and prior balance payoffs live. If those two lines differ by $8,000, that $8,000 is part of your cost even though you never touched it.

You get one disclosure, and only one

Section 559.9613 carries a limit that matters more than it looks. Only one disclosure is required per transaction, and none is required for a modification, forbearance, or change to a transaction that has already closed.

Read that against how these deals go. The disclosure arrives at signing. The paperwork that costs you the most tends to arrive months later, when the debit is bouncing and the funder offers a reduced payment or a rewritten schedule. That document can add fees, extend the term, and raise what you repay in total, and no fresh cost page has to come with it.

So ask for one yourself. Before you sign any modification, request the new total amount to be repaid and the new total dollar cost in writing, in the same two lines the original disclosure used.

The number Florida did not require

Florida stopped at the total dollar cost. There is no annual percentage rate on a Florida disclosure.

Work an example. Take a hypothetical. Suppose Baymeadows Auto Body signs for $80,000, and the disclosure shows $73,600 disbursed after a hold, with $112,000 total to be repaid at $933 per business day.

The disclosure tells you the total dollar cost is $32,000. What it does not tell you is that you are paying $32,000 to use $73,600 for roughly six months, on a schedule that starts shrinking your balance from day one. On an amortizing daily payment structure, the effective annualized cost of that money lands far above the raw 43 percent ratio the two numbers suggest, because you never have the full amount for the full term.

That is the reason two other states went a different direction, and it is the strongest argument for doing your own math even when the paperwork is complete.

Three states, three different questions

The states that regulate this paperwork did not ask funders for the same thing.

New York requires an estimated annual percentage rate when a specific offer is extended, so the number is in front of you while you can still walk. California also settled on an annualized rate, on a standardized form. Florida asked for dollars, at or before closing.

The same advance produces a different page depending on which rule applies, and coverage turns on where your business is managed rather than where the funder sits. If you hold positions from more than one funder, read what New York puts in an offer summary and the rate line California added next to your Florida page.

None of the three capped a price. A cost that is disclosed correctly is still legal at any number, which makes each of these forms a comparison tool, not a shield.

What the law says to brokers

Section 559.9614 is aimed at the broker layer, which is where a lot of the pressure in this market comes from. Brokers may not charge an advance fee for brokerage services. The narrow exception is that you can pay for actual third party services needed to apply, such as a credit check or an appraisal, if you pay by check or money order made out to a party independent of the broker.

Brokers also may not make false or misleading representations or omit material facts, and their advertising must carry the real street address and phone number of the business, plus the contact details of any forwarding service they use.

If a Florida broker asked you to wire a fee to get an advance approved, that is squarely what this section prohibits.

How enforcement actually works

Section 559.9615 gives the Florida Attorney General exclusive authority to enforce the law. Penalties run $500 per violation with a $20,000 aggregate cap, rising to $1,000 per violation and a $50,000 cap once a provider has received written notice of a prior violation.

Two limits matter to you personally. There is no private right of action under this part, so a missing disclosure is not by itself a claim you can file. And a violation "does not affect the enforceability or validity of the underlying commercial financing transaction," so a defective disclosure does not cancel the advance.

The practical use of the law is evidentiary, not curative. A funder that ignored the disclosure requirement has created a record, and complaints to the Attorney General's office are how that record accumulates.

Using the disclosure when you are already behind

Pull the disclosure page for every Florida advance dated 2024 or later and copy four figures onto one sheet: amount disbursed, total payback, total dollar cost, and the current daily amount. Do the same from the contract itself for anything older.

That single sheet is what turns a stack of agreements into a negotiating position, because it shows in one view how much of your week is already committed before you serve a customer.

A reasonable next step

Find the disclosure for your most recent advance and check line 2 against your bank statement for the day the money landed. If those two numbers do not match, you have found a cost you did not know you were paying, and that is worth an hour of your time to reconcile.