How many parties are needed to exercise the Right of Rescission for a loan?

The Right of Rescission is a consumer protection mechanism provided under the Truth in Lending Act (TILA) that allows borrowers to back out of certain types of loans, such as refinances and home equity lines of credit, within a specific timeframe. For this right to be exercised, only one party is necessary – the borrower.

The borrower can rescind the loan agreement simply by notifying the lender within the prescribed period, typically three business days. This is meant to ensure that consumers have the opportunity to reconsider the terms and implications of borrowing without undue pressure. The focus is on the consumer's right to change their mind, even if there are co-borrowers involved; each individual has the legal right to initiate the rescission on their behalf.

Therefore, the correct response aligns with the fundamental principle of the Right of Rescission that prioritizes individual borrower rights in the loan agreement context.