Which document must be provided to the borrower to inform them about their right to rescind?

The document that must be provided to the borrower to inform them about their right to rescind is the Notice of the Right to Cancel. This notice is a crucial part of the Truth in Lending Act and is specifically designed to ensure that borrowers are aware of their right to cancel certain transactions, particularly in home equity loans and lines of credit, within a specified period (typically three days).

This notification serves to protect consumers, allowing them to reconsider their decision after entering into a loan agreement, especially in cases where they might feel pressure to finalize a decision quickly. The Notice of the Right to Cancel clearly outlines the process for rescission, including the timeframe during which the borrower can exercise this right.

While the loan application sets forth the borrower's details and intentions, the Truth in Lending statement provides key information about the cost of credit, and the Good Faith Estimate outlines the expected costs associated with obtaining a mortgage, none of these documents specifically address the borrower’s right to rescind the agreement. Thus, the Notice of the Right to Cancel is critical because it directly informs borrowers of their legal rights in a clear and accessible way.