Which loans can I rescind under TILA?

You can rescind non-purchase-money loans secured by your principal dwelling: refinances of an existing mortgage, home-equity lines of credit (HELOCs), and closed-end home-equity loans. You cannot rescind the original purchase-money mortgage used to buy the home. 15 U.S.C. § 1635(e).

How long do I have to rescind?

You have 3 business days from closing if the lender gave you all required TILA disclosures and two copies of the rescission notice. If the lender failed to provide those disclosures, the right of rescission extends up to 3 years from the date of consummation of the transaction. 15 U.S.C. § 1635(f); Reg Z 12 C.F.R. § 1026.23(a)(3).

What must the lender do after I rescind?

Within 20 calendar days the lender must: (1) return all money or property given as earnest money, down payment, or otherwise; (2) take action to cancel and terminate the security interest; and (3) return all finance charges, fees, and payments made. 15 U.S.C. § 1635(b); Reg Z § 1026.23(d).

How does rescission interact with foreclosure or bankruptcy?

A timely rescission notice stops the security interest from vesting — which can halt or complicate a foreclosure. In bankruptcy, rescission is an affirmative defense that can reduce a secured claim to unsecured. Deadlines are strict and the interaction with automatic stay rules is complex; consult Counsel chat for your specific situation.

Debt defense overview

TILA right of rescission — 15 U.S.C. § 1635

Cancel the loan. Get your fees back.

Under 15 U.S.C. § 1635 and Reg Z 12 C.F.R. § 1026.23, borrowers have an absolute right to rescind certain home-secured loans within 3 business days of closing — or up to 3 years if the lender failed to provide required disclosures. After rescission the lender must cancel the security interest and return all fees within 20 days. The wizard builds the notice for you.

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Companion tool

FDCPA cease-and-desist letter

If a debt collector is calling about this loan, invoke your right to silence them while you pursue rescission.

Open the cease-and-desist wizard

Companion tool

FCRA credit-bureau dispute

If the lender or servicer has reported this loan to the credit bureaus, dispute the tradeline under § 1681i while rescission is pending.

Open the FCRA wizard

Lender refuses to honor your rescission?

Case Pass — $149

Rescission notice, FDCPA cease-and-desist, FCRA dispute, violation scanner, answer to complaint, deadline tracking, AI Q&A, and unlimited follow-up letters for one debt case. 12 months.

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