Juneteenth freedom day

A New Federal Holiday. What Now?

On June 17, 2021, the U.S. got its first new National Holiday in 38 years. June 19th has been designated as “Juneteenth National Independence Day.” Our last new National Holiday, Martin Luther King, Jr. Day, the third Monday in January, was instituted in 1983.

So, what’s different about these holidays and why does it affect me? Well, besides recognizing the end of a terrible time in American history, we have a new day that will be impacted for Rescission purposes and Disclosure delivery under Regulation Z.

June 19th is treated like any “actual date” Holiday such as New Year’s, Independence Day, Veterans Day and Christmas – meaning the Holiday is only on that date and not the date observed, at least, for our purposes.

The Precise definition of a business day (all calendar days except Sundays and Federal Holidays), there are no additional days factored in when determining business days. Many institutions will be closed on Friday June 18, 2021 (or Monday June 20, 2022) in observance of the Holiday.

These dates, however, will be considered business days for the Notice of Right to Cancel and delivery of the Closing Disclosure. Here are a few examples:

  • If you close on a Refinance loan that is subject to Regulation Z on June 17, 2021, the right to cancel expires June 22, 2021, and you may pay out the proceeds on June 23, 2021.
  • If you mail a Closing Disclosure (without borrower receipt) on June 17, 2021, the closing may occur on June 25, 2021.
  • If you hand-deliver or email a Closing Disclosure (with borrower receipt on the same day) on June 17, 2021, you may close the loan on June 21, 2021.

The precise definition of a business day also applies to borrowers receiving Escrow Cancellation Notices when applicable, as well as delivery of initial disclosures or placing them in the mail no later than the seventh business day before signing.

For the Standard/General definition of a business day (days we are open for business), if your bank closes on June 18, 2021 (or June 20, 2022) these are not considered business days. Therefore, when providing Loan Estimates and other initial disclosures, you do not need to count those days as business days.

For example, if you receive an application on June 17, 2021, you have until June 22, 2021, to mail or provide the Loan Estimate and initial disclosures.

When it comes to the appraisal delivery, the business day definition is not defined but it is a good practice to send the appraisal at least three precise business days before signing to make sure the borrower has adequate time to review the appraisal.

TCA has A Better Way to keep you in the know and up to date. Contact us at [email protected] or (800) 934-7347 for your compliance, BSA and Fair Lending needs.

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