Rescission Notice to Owners Only

Answered by:

Question:

I am doing a home refinance for a husband and wife. The Deed of Trust is vested in his name only as his separate estate. Both husband and wife live at the home. Should the wife also be a grantor on the property and receive a Right of Recsission?

Answer:

Section 226.23(a) states: 1. In a credit transaction in which a security interest is or will be retained or acquired in a consumer’s principal dwelling, each consumer whose ownership interest is or will be subject to the security interest shall have the right to rescind the transaction. The creditor must deliver two copies of the notice of the right to rescind to each consumer who is entitled to rescind.

Notice that the Right of Rescission only applies to those that reside in the home as their principal dwelling and if they have a ownership interest.

First published on BankersOnline.com 1/6/03