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When Does Rescission Begin

Answered by: 
Randy Carey

Question: 
This question is on rescindable mortgage transactions. Let's assume one borrower comes in to sign all the loan documents today, with a coborrower scheduled to sign later that same day. But that second borrower doesn't come in until the following day to sign. Does rescission period start the next day after all those signatures were made and all documents have been signed, that being consummation?
Answer: 

The transaction will not be consummated until all borrowers sign the promissory note:

1026.23(a)(3)(i) The consumer may exercise the right to rescind until midnight of the third business day following consummation, delivery of the notice required by paragraph (b) of this section, or delivery of all material disclosures, whichever occurs last.

First published on 07/23/2023

Filed under: 
Lending
Filed under lending as: 
Reg. Z

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