Closed end line of credit and ROR

I did a search and found a lot of posts regarding HELOC's and purchase money but this is a little different.

We have a customer who is requesting a closed end line to purchase a home which needs some work. The line will be secured by the new home and their current home (until it sells).

Will the initial draw for the purchase be rescindable? I know the subsequent draws for the improvements would be since it is secured by their current home.

They are purchasing the home from Freddie and they stated that a rescission period was unacceptable because they needed the money within 24 hrs.

We need the extra collateral because of LTV issues.

Thanks

You will have ROR on this one because of the current PR being taken as collateral. Think of a bridge loan, you still have ROR if you take the current home.

Here's the chapter and verse:

Notwithstanding the general rule that consumers may have only one principal dwelling, when the consumer is acquiring or constructing a new principal dwelling, any loan subject to Regulation Z and secured by the equity in the consumer’s current principal dwelling (for example, a bridge loan) is subject to the right of rescission regardless of the purpose of that loan. For example, if a consumer whose principal dwelling is currently A builds B and secured by A is subject to the right or rescission. A loan secured by both A and B is, likewise, rescindable [Commentary to §1026.23(a)(1) #4].