What Is Fine Print?

The "fine print" is a term that refers to contract terms and conditions, disclosures, or other important information that is not included in the main body of a document but placed in footnotes or a supplemental document.

Reading and understanding the fine print is essential when entering into an agreement. It often contains information that the issuer does not want to call to the recipient's attention but that is essential for the recipient to know.

Fast Fact

A study by NextAdvisor found that 54% of U.S. adults find the fine print on their frequent flyer contracts confusing and 47% claim to be "perplexed" by loyalty program terms and agreements that appear in the fine print.

Understanding Fine Print

Credit card agreements are famous for placing "surprise" fees, interest rates, and payment terms in the fine print of contracts. The information in the fine print may be required by law or may be recommended by a company's legal department.

For example, the fine print on a credit card contract might include important financial information such as the card's introductory annual percentage rate (APR), the APR after the introductory period ends, the length of the introductory period, the APR for balance transfers and cash advances, the card's annual fee, and late payment fees.

As another example, if an investor reads a public company's financial report, the investor might have to read the fine print to learn about the company's accounting methods, long-term debt, employee stock ownership, or pending litigation.

Key Takeaways

  • The "fine print" is a term that refers to contract terms and conditions or disclosures placed in footnotes or at the end of the manuscript where it is easily overlooked by the reader.
  • The information contained in the fine print is often essential for the recipient to know.
  • Credit cards are notorious for placing hidden fees, interest rates, and payment terms in the fine print of contracts.

Criticism of Fine Print

Fine print is often controversial because of its deceptive nature. The purpose of fine print is to make the reader believe that the offer is better than it might actually be. Although the real terms of the offer are technically available to a reader in the smaller print of the advertisement—thus ensuring plausible deniability from claims of fraud—this smaller print is often designed to be overlooked by the reader.

The unsuspecting reader, distracted by the attractive aspects of the offer, may not bother to read the fine print due to time constraints and/or personal need. A reader may also assume that the smaller print is less important than the larger print.

Many offers advertised in large print only apply when certain conditions are met; in many cases, these conditions are difficult or nearly impossible to meet.

Many highly regulated sectors, such as banking and financial services, complain of overly regulated mandates that require documents be laden with legalese. Anyone who has obtained a conventional mortgage knows the weight fine print adds to the loan documents. Although well-intentioned, the myriad clauses and caveats make transparency and comprehension difficult.