Reg Z 226.23(a)(2) states "to exercise the right to rescind, the consumer shall notify the creditor of the rescission by mail, telegram or other means of written communication. Notice is considered given when mailed, when filed for telegraphic transmission or, if sent by other means, when delivered to the creditor's designated place of business.

On several different rescission notices I have seen in the section "How to Cancel" it says, "If you cancel by mail or telegram you must send ....midnight 3rd day.

There is also a sentence that says, "If you send or deliver your written notice to cancel some other way, it must be delivered to the above address no later than that time.

Where is this coming from? Is it saying that it must be delivered on or prior to midnight of 3rd day? Does it mean that if they mail or telegraph it can be received sometime after the 3rd day?

You are correct that a bank could receive a rescission notice after the 3 business days and it was mailed timely - especially around the holidays! That is why many banks use an acknowledgement from the borrowers to confirm that they have not cancelled the transaction. The borrowers simply have to initiate the action by midnight of the third day.

And, of course, if I were the rara avis who wanted to rescind at 11:59 p.m. on the the third business day, I would hie me to a post office mail receptacle, and have a trusted friend videotape my deposit of the notice into the caring arms of the Postal Service. I'd also make sure the tape recorded the time and date, and the friend would testify as to what, where, who and when.

And if the envelope doesn't get delivered until five days later, and the bank has disbursed funds without asking me to sign the acknowledgment, won't there be fun unravelling this mess!

Seriously, in the 27 years I've been doing compliance, we've only had one rescission, and that was from a widow whose husband had died of a stroke the day after closing.

That text is from the sample forms provided in Reg. Z. As correctly noted above you certainly could receive the RoR after the three day period if sent by an "approved method, i.e. mail or telegraph. That is why many forms have that additional box which says something to the effect of "I haven't canceled and my time is expired". Also as noted in your other thread completing that in advance is a poor practice.

Part of me wonders when the first case will happen with e-mail rescission.

Sometimes you are responsible for your own actions, and sometimes you are responsible for others.

I've been doing this for over 20 years (20 years today with my current bank ) and I've yet to see a rescission, though I know it does happen.

I got a chuckle out of John's rescission story -- not the husband dying of course -- but the only time in 27 years he received a rescission.

I've only had 1 rescission in 16 years. It was in 1991 when an annoying borrower wanted a lower rate on his 30-year mortgage loan application AFTER he already locked in for 60 days. I tried to get the home office to give in to a lower rate, but no luck.

So the brrower did the next best thing: went to the closing, waited a day or two, and then rescinded! Of course, full refund of anything he had paid!

He came back after rates dropped even more and re-applied.

MarkB

I must live wrong....I have had a number of rescissions occur over the years at different institutions, some rate driven, some just because they changed their mind, etc. And one or two were horror stories for various reasons that ended up with attorneys involved working out the details when the dust settled (and the lending group found the rescission form that had been returned "to the wrong internal address" while they funded).