Foreclosure Defense: Right of Rescission
If you refinanced your home in the last three years, you may have a powerful defense if you are now facing foreclosure. Under the federal Truth in Lending Act (TILA), you could have grounds to rescind the transaction if the lender failed to comply with the letter of the law. The most common blunder is failing to provide borrowers with two copies of the notice of right to rescind.
If your refinancing or mortgage loan was invalid, your subsequent loan default is likewise invalid, which in turn interrupts foreclosure. The experienced Chicago foreclosure defense lawyers of Atlas Consumer Law have successfully challenged foreclosures by invoking the right of rescission. We will vigorously assert every affirmative defense to help you save your home.
Contact us today online or by telephone our Lombard law office at (312) 313-1613 to speak with an experienced mortgage law attorney.
Holding Lenders Accountable for TILA Compliance
You surely remember the blizzard of paperwork and all the hoops you had to jump through when you bought or refinanced your house. Pay stubs, tax returns, proof of citizenship. Explain this. Verify that. Resubmit such and such. Sign here, here, here ... and here.
The Truth in Lending Act (TILA) turns the microscope back on the lenders. TILA mandates specific information that must be disclosed and documents that must be provided. The law requires that lenders provide two copies of the right to cancel (one for each spouse or co-debtor). Under TILA, a borrower has three years to rescind the transaction if two right to rescind notices were not provided at closing. Moreover, the borrower may be entitled to monetary damages.
A common scenario: The husband obtains refinance credit under his name, but his wife has an interest in the property. The lender provides him with the right to cancel documents, yet does not provide a second set to her.
The whole intent of the Truth in Lending Act was to protect borrowers from deceitful practices, hidden fees and sloppy paperwork rampant in the mortgage lending industry. The 7th U.S. Circuit Court of Appeals has upheld a "hyper-technicality" interpretation of the TILA requirements, giving the benefit of the doubt to borrowers who enter mortgage transactions in good faith.
- Invoking a right to rescission claim under TILA within the three-year window can:
- Stop foreclosure, at least temporarily
- Enable borrowers to walk away from a bad mortgage
- Result in an award of statutory damages
- Force lenders to engage in a workout or new loan
Explore Your Defenses - Illinois Foreclosure Defense Attorneys
We examine all grounds for challenging a foreclosure, including defective mortgages, TILA violations, lack of standing and other strategies. In short, we will fight for you and vigorously enforce your rights in a process stacked against borrowers.
Several of our attorneys have been recognized as "Rising Stars" in Illinois Super Lawyers magazine, based on legal acumen and consistently favorable results for clients. We represent distressed homeowners, including many high earners, across the Chicagoland area.
Email us today or call (312) 313-1613 to discuss your options to save your home or escape from an underwater mortgage.