OK...soooo, every consumer who has ownership in a principal dwelling has the right to rescind the transaction. The rescission period cannot begin until all consumers receive "material disclosures." The term "material disclosures" is defined as "the required disclosures of the annual percentage rate, the finance charge, the amount financed, the total of payments, the payment schedule, and the disclosures and limitations referred to in §§1026.32(c) and (d) and 1026.35(b)(2)."

So does the term "material disclosures" include the ETIL? In a situation where one owner is the borrower and the other owner is not, both owners must receive material disclosures. But since the ETIL is a "shopping" disclosure and only one owner is "shopping," is this a "material disclosure" that triggers the ROR period?

I'll let Dan chime in on this one. He has done the research on this issue.

When given in an ETIL, the APR, FC, AF, etc. are not "the required disclosures"--they are estimates of "the required disclosures."

See the following for a recent discussion on the ETIL and non-borrowing owners.

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1750340&page=1

OK....so I'm having difficulty tieing 1026.17(d)....all consumer's (as defined) must receive the disclosure, to 1026.19(a) with respect to the early disclosure.

All cosnumers who have the right to rescind must receive a copy of the ETIL disclosure.

(d) Multiple creditors; multiple consumers. If a transaction involves more than one creditor, only one set of disclosures shall be given and the creditors shall agree among themselves which creditor must comply with the requirements that this part imposes on any or all of them. If there is more than one consumer, the disclosures may be made to any consumer who is primarily liable on the obligation. If the transaction is rescindable under §1026.23, however, the disclosures shall be made to each consumer who has the right to rescind.

I'm trying to argue in favor of providing the etil to a non-borrower owner. Soooo....

1026.17 outlines how and to whom the information set forth in 1026.18 is to be provided. 1026.19 states that for certain transactions, the information set forth in 1026.18 must be provided early. And there is no change in to whom the information must be provided.

Is that my argument?

From the above linked thread.

The requirements of the ETIL and the material disclosures are not one in the same.

1026.17 identifies the general disclosure requirements for the ETIL estimations. In its timing requirement it specifically refers to the requirements of .19(a) and then it goes on to say in .17(d) that each consumer who has the right to rescind is to receive a copy of the disclosure; for the purposes of rescission non borrowing parties are consumers if a security interest is being taken in their primary residence.

Ah!! I missed the reference to 1026.19(a) found in 1026.17(b). Now I get it. Thanks so much Dan.

So taking the non-borrowing owner scenario out of this discussion, in any rescindable transaction, you need to make sure that you print enough copies of the ETIL so that EACH borrower with rescission rights gets his/her own copy - since the ETIL is considered a "material" disclosure, correct?

Each consumer that has the right to rescind is to receive a copy of the ETIL.

Reg. Z does not require a final TIL if the ETIL is within the applicable APR tolerance. Before automated documentation became the norm many financial institutions did not "re-type" the TIL at closing (there's probably not many of us left that remembers using a typewriter to complete the loan documentation). The ETIL in itself is not the material disclosures. It would only become the material disclosures if a final TIL is not issued. The purpose of .17(d), IMO, is to insure that all persons will get a copy of the "material disclosures" in those cases where a final TIL is not issued.

In today's automated world this requirement is a bit dated but it is still a requirement.

Right. It contains estimates of the material disclosures. These estimates can "graduate" into material disclosures if no FTIL is given.

Okay then...I totally misunderstood the last debate we had on this...I thought (apparently misinterpreted) you were saying that when they changed/re-worded/etc the 7 day rule, the unintentional consequence was that it applied to rescission purposes as well.

I just changed my procedures on this...I guess that was incorrect afterall (we always prepare a fTIL).

I thought (apparently misinterpreted) you were saying that when they changed/re-worded/etc the 7 day rule, the unintentional consequence was that it applied to rescission purposes as well.

The earliest hard copy of Reg Z that I still have is the 1981 revisions. .17(d) is in that revision so the requirement has been around for quite sometime. It was not a result of the MDIA revisions.

See...misinterpreted one of the threads on this subject. Thanks, Dan.

Sadly, I do remember using a typewriter...

Thanks for your clarification on this issue, Dan.