TILA - Who has the right to rescind?

226.23(a)(1) States that each consumer who has an "ownership interest" in the principal dwelling shall have the right to rescind.

I've always taken this to mean that the person must be an actual owner on the deed. There is no mention of community property (if the house happens to be located in one).

Am I right? Only actual owners of record need to be given the right to rescind the transaction. If a spouse is not an owner.....no rescission.

Ownership interest in the principal dwelling extends to marital property and dower interests too. So no, you're not right. Sorry. But you've got to give the spouse ROR if they're living in the property that's being refinanced.

Dan quotes chapter and verse in his response to a similar question here

Actually, per the commentary dower rights do not trigger ROR under federal law. See this prior thread.

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1432570

State law might vary.

Just to clarify. My response in the linked thread specifically states "if the wife (consumer) has the ROR". Look to the definition of a consumer in 226.2 and its Commentary at (a)(11)(2).

As Kathleen states under Federal law the ROR does not extend to dower rights but state law may. If state law is more restrictive then it will take precedence.

Thanks everyone. Under Texas state law, a non-owner spouse only has the right to rescind a home equity loan. This is in our state's constitution. Amazingly though, for a home improvement loan the constitution states that only the owner has the right. And our state rescission law counts calendar days which means fewer days than the federal requirement so we just always use the federal rules. Just thought inquiring minds might want to know this.

And we thank you for that info!

....just want non-texas compliance professionals to feel my pain.....