When does the three-day rescission period begin?

The three-day rescission period is a critical component of the Truth in Lending Act, primarily affecting home equity loans and refinances involving a primary residence. The rescission period allows borrowers the right to cancel the transaction without penalty, and understanding when this period begins is essential for compliance with Regulation Z.

The most precise understanding is that the rescission period begins upon receipt of all required disclosures, including the notice of the right to rescind. This period officially starts when the borrower receives the right of rescission notice, which is typically provided at the time of loan closing but can also be influenced by whether the borrower has received all necessary disclosures. If not all disclosures are provided at the time of consummation, the rescission period may not start until the borrower receives this important information.

Therefore, all the choices in the question contribute to the initiation of the three-day period. At the time of consummation, the rescission agreement is put into effect; however, the borrower must also receive the relevant disclosures, which ensures they are fully informed of their rights. In sum, the rescission period is a combination of each of these touchpoints that ensure the borrower is provided with the information necessary to make an informed decision about their loan and their rights. The collective