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#25766 - 07/29/02 08:09 PM Right of Rescission
Anonymous
Unregistered

For loans subject to the right of rescission, when should we start collecting interest-- the day of closing or the day after the rescission is up?

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Lending Compliance
#25767 - 07/29/02 08:13 PM Re: Right of Rescission
Anonymous
Unregistered

You are allowed to do either. We accrue interest for the three day period.

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#25768 - 07/29/02 08:26 PM Re: Right of Rescission
DCollins Offline
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DCollins
Joined: Oct 2001
Posts: 707
That's interesting. Can you tell me where in Reg Z it says that? I would like to show it to management.

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#25769 - 07/29/02 08:39 PM Re: Right of Rescission
Andy_Z Offline
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Andy_Z
Joined: Oct 2000
Posts: 27,757
On the Net
I believe the correct answer is, Reg. Z doesn't prohibit it, but check to see that your State's law allows it.
_________________________
AndyZ CRCM
My opinions are not necessarily my employers.
R+R-R=R+R
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

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#25770 - 07/29/02 08:48 PM Re: Right of Rescission
redsfan Offline
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redsfan
Joined: Dec 2000
Posts: 3,455
The Pennant Race
As usual, Andy is correct. Comment 226.23(c)-4:

"Section 226.23(c) does not prevent the creditor from taking other steps during the delay, short of beginning actual performance. Unless otherwise prohibited, such as by state law, the creditor may, for example:

Prepare the loan check;
Perfect the security interest;
Prepate to discount or assign the contract to a third party;
Accrue finance charges during the delay period."
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The opinions expressed here are personal and do not represent opinions of my employer.

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#25771 - 07/29/02 09:27 PM Re: Right of Rescission
BankerMama Offline
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BankerMama
Joined: Jun 2001
Posts: 1,543
Correct. I have seen it done either way during my career but I think most do accrue interest during the 3 day period (if their state laws allow of course)

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#25772 - 07/30/02 02:04 PM Re: Right of Rescission
DCollins Offline
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DCollins
Joined: Oct 2001
Posts: 707
Appreciate the comments. I will be looking into this further.

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