Funding Loans & Right of Rescission

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Question:

Scenario: Husband and wife refinance house. Wife signs loan documents on Friday and husband signs on Monday. Each sign their Notice of Right to Rescind dated the day they signed. Is it not legally true that the loan can thenfund on Friday after husband signed? Why would a lender make the parties resign the Notice of Right to Rescind over again dated (let's say 81001) and start the rescission period over again. Thereby not being able to fund loan until Wednesday 81501. Where can I get written law that states the lender should have funded on the Friday after the husband's right to rescind was signed?

Answer:

The ability to rescind applies to each consumer with an ownership interest in the dwelling. The rescission period willextend for three business days from the last of three events:

Consummation of the transaction
Delivery of all material disclosures
Delivery to the consumer of the required rescission notice

In the scenario you identified, the last rescission was signed on Friday the 10th. Rescission would have included Saturday, Monday and Tuesday. Funding could have taken place on Wednesday the 15th.

First published on BankersOnline.com 10/1/01