closing and 3 day recession

what are my rights if the lender pushes the loan through before the 3 days are up?

Hi Mark,

Welcome to Mortgagefit discussion board.

A similar question was asked today on this page: http://www.mortgagefit.com/know-how/rescind-loan.html

Kindly have a look to know the answers community members have given to that question.

Do let me know if you have any other questions.

Thanks
Blue

the loan cannot fund until the end of the rescission period. this is a federal requirement and cannot be avoided. the rescission period starts after the loan is signed or closed and ends at midnight at the end of the third business day. saturdays are counted as a day of rescission but sundays and holidays are not. if you close on a tuesday for example, then wednesday, thursday and friday are your rescission days ending at midnight friday night. in that case, your loan will not fund until monday as funding only happens monday through friday.

the rescission period is a protection for a borrower in a refinance transaction and only applies to refinances of primary residence properties. rental properties, vacation homes, loans on unimproved land and all purchase loans are not affected by the rescission requirement.

the purpose is to give the borrower extra time after closing to consider if the loan that they signed truly meets their needs. this prevents borrowers from getting to the loan closing and signing a loan with terms different then what they expected and having to succumb to pressure at closing to sign a bad deal.

while it is true that during the rescission period the lender could also cancel the loan, this rarely happens unless something comes up to point to fraud or misrepresentation on the borrower's part....or in the case of the lender going out of business during the rescission period which happened earlier this year with some of the large sub-prime lenders going under.

hope this helps...

Ken, I like the idea of giving the borrower the right to rescind a loan. It gives the borrowers a chance to think over again even though the closing is over. That's a good thing that the industry has thought about its borrowers. The right of rescission helps the borrowers to go after a better deal at times when they feel that they cannot manage the deal they have already signed for.

What happens when a lender doesn't acknowledge receiving the right to rescind? I sent it certified, they signed for it within the 3 day window then denied ever getting it. They then funded the loan !!!

Hi hdtv,

You will get 3 days time in order to rescind or cancel the loan. This is known as right to rescission. If your letter reaches the lender within 3 days, he should accept it. As your lender has denied receiving such a letter, you can consult an attorney and take his opinion in this matter.

Thanks.

just curious can you get out or use the three day rescission on a home loan ?

Hi rg!

Welcome to forums!

The right of rescission is not available for all mortgages. There is no right of rescission for a mortgage taken out to buy a house.

Feel free to ask if you've further queries.

Sussane

Can Lenders refuse funding after recession? I am going through this now, My loan got closed and on funding day the lender decides not to fund the loan to the mortgage co because the customer has been behind on payments for 6 mos now, why didnt they catch that in the beginning? Can they legally do this? Especially if recession is over?

Hi ginabean,

Though the rescission is over, the lender can refuse financing. However, in your case, the loan was already closed. In that case, the lender shouldn't refuse to give you the loan.

Can someone tell me if I refinanced and signed all the papers on a loan for my rental home through Wells Fargo. We signed all the papers and then two weeks later they said we had to redo all the paper work. Aren't those papers we signed the first time legel documents? I'm so confused can someone please help. We live in Ohio.