Legal Question in Business Law in Oregon

Re: Right to rescind

Your question addresses a very common misconception about auto loans. There is no right to rescind once the borrower or co-signer has signed on the loan.

Ofter the documents used for car loans are general documents used for "consumer" loans. These consumer loan documents reference a three day rescission right pursuant to a particular Oregon Revised Statute without explaining what that statute provides. The statute referenced is one that gives a borrower the right to rescind a transaction when it occurs during a door-to-door solicitation. This is the only rescission right specifically provided for under Oregon law.

Therefore, unless the car salesman went to your door to sell you the car, you cannot rescind the loan once you have signed it. The only other way you might have a rescission right is if the particular contract you signed specifically gives you the right to rescind, which is unlikely.

If there is a right of rescission, it would need to be done in writing, if for no other reason than to give you the ability to prove that you actually rescinded the transaction.