Posted by Art_MD on 11/13/11 8:29am
Msg #403733

Who gets RTC??

A brother and sister own 2 homes. Each lives in one of the homes.
They refinance 1 - where the sister lives.
Does the sister get RTC and the brother doesn't?

Art

Reply by Ilene C. Seidel on 11/13/11 8:39am
Msg #403734

Anyone on title gets RTC whether they live in it or not.

Reply by Notarysigner on 11/13/11 9:35am
Msg #403737

In Ca usually the primary residence gets RTC, second home usually NOT. BUT......That is the TC call not ours.

Your situation as stated has a twist to it so I would be interested in the final answer myself.

Reply by JanetK_CA on 11/14/11 1:45am
Msg #403823

For the record, I believe the RTC is dictated by federal law, not state law, so this would apply everywhere. I'd be interested, too. My guess is that the RTC would apply to both parties on both properties, since each home is the primary residence for one of the persons on title - but that's just a guess.

Reply by Linda_H/FL on 11/14/11 5:04am
Msg #403828

I think the "state law" criteria would come into play

when state law affects title to the property. Example: Florida is a homestead state - spouse not on title of primary residence still has to sign the security instrument "consenting" to giving of the security - they have rights of rescission so, therefore, sign RTC and get two copies at closing.

I agree - I think in this case since each home is a primary residence, both "parties in interest" would receive an RTC. However, it is this type of case where state laws as to vesting would come into play.

JMO

Reply by MW/VA on 11/13/11 9:49am
Msg #403738

Trick question? Sounds like something XYZ would pose. LOL

Anyone signing on the loan gets the RTC's, of course. Residency has nothing to do with it.
If it were considered investment property or 2nd home there wouldn't be a RTC in the first place.

Reply by Art_MD on 11/13/11 10:12am
Msg #403739

Re: Trick question? NOT

real case.

As it is not the principle place of residence for one borrower, wouldn't it be considered 2nd home or investment property? No RTC ???

Art

Reply by MW/VA on 11/13/11 10:40am
Msg #403745

I don't think so. I gathered from your scenario that they

were on title on each other's property. Even if NBS applies, they have a financial interest in that property. It sounds like both properties are considered owner-occupied & primary residences for one of them.

Reply by Julie/MI on 11/14/11 5:49am
Msg #403831

Re: Trick question? NOT

Way overthinking, I think.

I believe this ultimately falls under the probate code in some states, not the IRS.

If a person is on title to a home that is being refinanced, they need to be made aware that a lien is being placed on their inheritance rights. So while it's somebody's primary they still have inheritance rights and have the right to cancel.

That's why it's a huge pita when parents add their children to the property to avoid probate and then decide to refinance because all the children and their spouses all have to sign.

Reply by Buddy Young on 11/13/11 10:23am
Msg #403743

The loan package will probably have names already printed on the RTC forms. If they don't, whoever signs gets one or two copies.

Reply by Bob_Chicago on 11/13/11 10:31am
Msg #403744

Re: Who gets RTC?? Where is Paul (RIP) when we need him?

As I see it , following get 2 copies of RTC.
1 On title
2 Interest in the property (eg. non borrowing spouse)
3 If the lender/TC has put their name on the signature line of the RTC and/ or the mortgage/TD
As I recall the standard is "Does the individual have an interest in the property,which interest will be extinguished if the mortgage/TD is later foreclosed?
Not sure if someone is entiltled to a RTC if they are only acting as a guarantor, but I would think so.

Reply by Barb25 on 11/13/11 10:47am
Msg #403746

Where is the Lender?

With all respect to Paul as we all miss him, his knowledge and advice. Why isn't the lender being called on for this information. It is up to the lender to be compliant. We are not the watchdogs. Not even the Title company. These are lender docs. Ask the lender...

Reply by Notarysigner on 11/13/11 11:35am
Msg #403751

PAW IS with us in spirit...I just did a search and PAW

referenced this RTC issue approx 200 times. What's interesting some of his conclusions which mirrors some of the posters in this thread although you know PAW, there's more detail.

try Msg #291327, Msg #360593, Msg #308082 and Msg #295964 for starters. If you want to read ALL 200 let me know and I'll tell you how to get there if you don't already Know.

Thanks Bob for providing the challenge, WWPAWDO?

Reply by Les_CO on 11/13/11 10:47am
Msg #403747

I say If the Brother Is on the note they both get the RTC
If the Brother is in title, but not on the loan, I say prudence would dictate both...but then ‘perhaps’ only the Sister?
Is the home considered an investment property or a second home by the Brother (as per IRS). How to they hold title? Is the Brother married? Is the Sister married? Is the property in a spousal, or community property State? I have seen cases where the Brothers wife would be required to sign the TIL, RTC, DOT.
This is really the TC call, and a laymen’s conjecture.

Reply by PegiT_MN on 11/13/11 11:33am
Msg #403750

If there is a Right To Cancel (RTC) included within the loan documents, then both the brother and the sister are going to sign. The bank has deemed that the subject property is not classified as an investment property, nor a second home, that is why they are including the RTC within the lender docs. It does not matter that the brother does not live there......he is in title and he is to sign the right to cancel. Not sure about the brother's residence because we do not know how it is classified (primary residence, investment property, second home). If you were signing loan docs for that one and the lender had included a RTC within the loan documents, then both brother and sister would be signing a RTC as they are both in title......it does not matter who lives in which house.

Here is where it gets tricky. I have always been taught that each person in title is supposed to sign their own Right To Cancel (RTC). Chase sends a blank RTC so that's easy. Wells Fargo prints one name on the RTC so that's an easy one. However, what is the proper procedure when a lender prints both names on each copy of the RTC. Do you have title holder #1 sign two to three copies of them and title holder #2 sign two to three of their own copies, or do you have them each sign on the same copies where their names are printed? That is a question our dear Paul (RIP) would have been able to answer for us.

Reply by Linda_H/FL on 11/13/11 12:07pm
Msg #403753

"However, what is the proper procedure when a lender prints both names on each copy of the RTC. Do you have title holder #1 sign two to three copies of them and title holder #2 sign two to three of their own copies, or do you have them each sign on the same copies where their names are printed?"

That's easy - you have both people sign at least five or six of them, but both signers sign all copies - one or two executed RTC's go back to title - each signer gets two copies each (I always leave executed copies of the RTC with the borrowers) - so 4 RTC's get left with borrower

Reply by JanetK_CA on 11/14/11 1:50am
Msg #403824

I agree. n/m

Reply by Pat/IL on 11/13/11 11:19pm
Msg #403815

"Do you have title holder #1 sign two to three copies of them and title holder #2 sign two to three of their own copies, or do you have them each sign on the same copies where their names are printed? That is a question our dear Paul (RIP) would have been able to answer for us."

Paul would answer the question correctly. He would tell you that the law does not require anyone to sign the RTC. It only requires that all parties with an interest in the property, in circumstances where ther RTC is required, be provided with two copies of the RTC.

Paul was a smart guy. I miss him too.

Reply by JanetK_CA on 11/14/11 1:55am
Msg #403825

He'd probably also go on to say that it's not up to us to make that determination and that we should follow the lender's requirements. In most cases, that would be to make sure that each party on title received two copies - regardless of how many signatures were on the form - and at least one signed copy would be returned to the lender with the completed package.

Reply by HisHughness on 11/13/11 12:31pm
Msg #403755

***Is the Brother married? Is the Sister married?***

In Arkansas, where there is a good likelihood they are married to each other, both get a copy of the RTC.

Reply by Les_CO on 11/13/11 4:28pm
Msg #403769

If I’m ever in a legal bind in Austin…I’m hiring His Hugeness to translate for and/represent me! He could know something I don’t?

Reply by desktopfull on 11/13/11 12:10pm
Msg #403754

Sounds like a ? on the #'s NSA cert. test. n/m