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New Home Purchase - Old Residence as Collateral
Answer by Dan Persfull, BOL Guru
Guru Bios
Question: We have a customer purchasing a new residence. They are using their existing home as additional collateral until it is sold and moving to the new residence. Does rescission apply since this is a purchase of a new home. What if additional funds over the purchase price are allocated for improvements to the new home? Does this change the rescission issue?
Answer: Yes, rescission applies. See the Commentary to 226.23(a)(1)(4).
First published on BankersOnline.com 11/06/06
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