A consumer with a loan for closed end credit may exercise his or her right to rescind until midnight on which day after signing the lending agreement?

A consumer who receives closed-end credit has the right to rescind, or cancel, their loan agreement under certain conditions as outlined by the Truth in Lending Act (TILA). Specifically, the consumer can exercise this right until midnight on the third business day following the signing of the lending agreement. This three-day period is established to give consumers sufficient time to reconsider their decision and ensure they fully understand the implications of the credit agreement.

The rationale behind this three-day rescission period is to allow consumers to make informed financial decisions without the pressure of immediate consequences. TILA mandates that consumers are made aware of this right, and lenders are required to provide clear disclosures regarding it. Thus, the correct option accurately reflects the statutory timeline for exercising the right to rescind after entering into a closed-end credit agreement.

Understanding this timeline is crucial for both consumers and professionals in real estate and mortgage services, as it protects consumer rights and ensures transparency in lending practices.