The right of rescission allows the borrower to completely cancel their mortgage transaction within three business days of signing the promissory note. However, its good to remember that this right does not blanketly apply to all mortgages. Home refinancings, home equity loans, home equity lines of credit and some reverse mortgages must have the rescission built into the signing. Therefore, a home purchase in particular would not have a right of rescission. Another important thing to remember is that this right only applies to owner occupied primary residences, not second homes or investment properties. Your lender must supply each borrower with two copies of the cancellation document and the Closing Disclosure as well. You then have until midnight of the third business day to send the rescission notice back to the lender either by email, postal mail or fax. I’m Stewart Brown, a licensed Mortgage Loan Originator in Palm Springs, California here to simply topics in Real Estate and Mortgage Lending. Please, like, share, follow and subscribe!
