A lender fails to provide the Notice of Right to Cancel form but properly delivers all other TILA disclosures for a refinance transaction. How long does the borrower have to exercise rescission rights?
Correct Answer
C) 3 years from loan closing
Under TILA Section 125(f), if the creditor fails to deliver the Notice of Right to Cancel, the borrower's right to rescind expires 3 years after consummation. The absence of this specific notice triggers the extended rescission period regardless of other disclosures being provided.
Why This Is the Correct Answer
Under TILA Section 125(f), if the creditor fails to deliver the Notice of Right to Cancel, the borrower's right to rescind expires 3 years after consummation. The absence of this specific notice triggers the extended rescission period regardless of other disclosures being provided.
More Federal Laws Questions
A mortgage broker's website states 'Qualified borrowers can get loans with down payments as low as 3%.' Which statement about TILA advertising requirements is correct?
A loan's APR increases from 4.25% on the Loan Estimate to 4.35% on the Closing Disclosure due to a rate lock expiration. What action is required?
A lender originates a mortgage that meets all QM requirements. Three years later, the borrower defaults and claims the lender violated the ATR rule. What legal protection does the lender have?
For a closed-end mortgage loan, when must the creditor provide the Closing Disclosure to the borrower?
Which of the following documents must be provided to trigger the start of the 3-day rescission period?
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