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Mortgages

How long do I have to rescind on a mortgage loan and when does the right of rescission start?

Unless you waive your right of rescission, you have until midnight of the third business day after the mortgage closing to cancel the contract.

The three-day clock does not start until all three of the following events have happened:

  1. You sign the credit contract
  2. You receive two copies of the a Truth-in-Lending disclosure form containing certain important disclosures about the credit contract:
    • The annual percentage rate
    • The finance charge
    • The amount financed
    • The total amount of payments
    • The payment schedule
  3. You receive two copies of a notice explaining your right to rescind

The first business day after the last of these events counts as day one. For rescission purposes, business days include Saturdays, but not Sundays or legal public holidays. For example, if the last of the above three events occurs on a Friday, you have until midnight on the following Tuesday to rescind.

You may use the form provided to you by the lender or a letter. Whatever form of written notice you use, make sure it is delivered or mailed before midnight of the third business day. Keep a copy and any evidence that it was delivered or mailed on time.

Tip: Please note that if the lender fails to give you two copies of the right to rescind or the Truth-in-Lending Disclosure, you continue to have the right to cancel the loan for up to three years.

Tip: If you have a problem with your mortgage closing process, you should discuss the issue or matter with your lender. If you’re having issues with your mortgage, you can also submit a complaint  to the CFPB online or by calling (855) 411-CFPB (2372). We’ll forward your complaint to the company and work to get you a response. You may also wish to get your own attorney to take a look at your issue or matter.

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