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Here are the facts:
John Doe has a first mortgage with ABC Bank on his principle dwelling. John comes into the Bank to refinance his loan to get a lower rate. Loan officer and borrower decide that the Secondary Market option is the best way to refinance the debt. The Secondary Market lender is responsible for approving/denying the loan application. Once the loan is approved, the loan will close in ABC’s name (table funded) and then subsequently sold to the Secondary Market lender (within a few days…the loan is sold individually and not as part of a group of loans). No new money is being advanced.
Is the refinancing subject to rescission?
If the loan is not subject to rescission but rescission documents were provided to the borrower at closing and the rescission was not honored (i.e. funds were disbursed prior to the rescission period ending), is this an issue (potentially UDAAP and or TILA)?
Your help is greatly appreciated!!
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