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Right of rescission Apply to Early Occupancy?

Question: 
We have a customer that has occupied a residence that they are purchasing, and they do not have another residence. Does the right of rescission apply to early occupancy in a purchase transaction? We have gone round and round with differing opinions.
Answer: 

by Randy Carey: So, if I rent a house that I live in and negotiate with the landlord to buy it, I still have no ownership in the house, so it would be like any other purchase transaction.

1026.23(a) Consumer's right to rescind. (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

Answer: 

by Richard Insley: Randy's advice about Reg. Z is correct. You are, nevertheless, free to grant a rescission option that is not required.

First published on 10/07/2018

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