Legal Question in Civil Litigation in Colorado
Loan cancellation
If you sign a borrowers agreement when applying for a loan
then find a loan with a lower rate, can you cancel the
initial loan as long as you have not received any money?
If there were any repercussions what could be expected?
This is on a mortgage purchase loan with an online lender.
1 Answer from Attorneys
Re: Loan cancellation
Hello:
Generally, Federal law provides for a three (3) day rescission period regarding mortgage purchases or refinance loans. When a lender makes these types of loans, it is required to disclose information about the rescission option. Generally, however, if the mortgage is not recinded within the 3 day period, it is binding and cannot be recinded. Generally, in order to rescind a loan, you must notify the lender in writing. You should look at the lender's website and your paperwork to see the requirements for recission.
I hope this helps. If you have further questions, feel free to call me, David Colt