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 is or will be subject to the security interest has the right to rescind the transaction. Lenders are required to deliver two copies of the notice of the right to rescind and one copy of the disclosure statement to each consumer entitled to rescind. The notice must be on a separate document that identifies the rescission period on the transaction and must clearly and conspicuously:
" disclose the retention or acquisition of a security interest in the consumer's principal dwelling;
" the consumer's right to rescind the transaction; and
" how the consumer may exercise the right to rescind with a form for that purpose.
The West Virginia Right to Rescind when a Security Interest in a Consumer's Principal Dwelling is Involved — Rescission, also known as the borrower's right to cancel a mortgage or loan agreement, is an important legal protection for homeowners in West Virginia. This right allows consumers to cancel a loan or mortgage agreement within a specific period if their principal dwelling is used as security for the loan. Here, we will delve into the details of this right and its various types, emphasizing the relevant keywords for better understanding. In West Virginia, the right to rescind when a security interest in a consumer's principal dwelling is involved is governed by state and federal laws, notably the Truth in Lending Act (TILL), which aims to provide consumers with clear and accurate information about loan terms and conditions. Under TILL, consumers have a three-day right to rescind certain non-purchase loans secured by their principal dwelling. This duration may vary in specific circumstances, as different situations entail different types of rescission. 1. Three-Day Right to Rescind: The primary type of rescission is a three-day right to rescind, which is applicable to most non-purchase loans secured by a consumer's principal dwelling in West Virginia. This means that the borrower has three business days, excluding Sundays and legal holidays, to cancel the loan agreement without any penalty or charge. 2. Extended Rescission Period: In some cases, the right to rescind may be extended for an extended period beyond the three-day window. This typically occurs when lenders fail to provide the borrower with all the necessary disclosures required by TILL. As a result, the borrower may have a longer timeframe, up to three years from the loan's consummation, to exercise their right to rescind. 3. Notice of Right to Rescind: Lenders are legally required to provide borrowers with a Notice of Right to Rescind, which outlines the borrower's rights and the steps they must follow to exercise their right to rescind. It is crucial for borrowers to receive this notice within three business days after the loan's consummation, or else the rescission period may be extended. 4. Rescission Procedure: To exercise the right to rescind, the borrower must provide written notice to the lender within the specified rescission period. This notice can be sent via mail, email, or any other method agreed upon by the lender. Once received, the rescission cancels the loan agreement, rendering it void. The lender is then obligated to return any fees or payments made by the borrower in connection with the loan. 5. Effects of Rescission: When a borrower successfully exercises their right to rescind, the lender must take specific actions. They must return any finance charges paid by the borrower, release any liens or security interests created by the loan, and return any property or money collected from the borrower as a condition of the loan. Understanding the West Virginia Right to Rescind when a Security Interest in a Consumer's Principal Dwelling is Involved — Rescission is essential for homeowners in West Virginia. By having knowledge about this right and its various types, borrowers can protect themselves from predatory lending practices and make informed decisions about their mortgages or loans.
