Three-Day Right of Rescission Law in Georgia

Closing a mortgage to buy a house can be an exciting time. Some states require many pages of documentation, including the loan note, before the real estate transaction can be completed. While signing at the close, you may not fully read each and every page. When you get home, you should spend time carefully reviewing everything that you signed, especially the terms of the mortgage note. If you find that the loan is not what you expected, you have a recourse, if you act quickly. In Georgia, the three-day right of rescission law can be used to cancel a mortgage that you recently signed.

Federal Law

The federal Truth in Lending Act (TILA) requires a three-day right of rescission in each state. This law regulates mortgages for owner-occupied properties. Buyers have three days after signing loan documents to cancel the agreement. Mortgages cannot be completed for the real estate transaction until the right to cancel is over. This clause of the TILA can be waived by the consumer if money from the transaction is needed for an urgent financial matter.

Georgia Law

The Department of Banking and Finance regulates all mortgage brokers in the state and administers the TILA in Georgia. When signing your closing documents, federal law requires that the lender must include two copies of a right of rescission form with the loan note, so that the cancellation information is readily available if the borrower has a change of heart. Georgia requires that the lender is notified in writing when the right to rescind is activated.

Cancel

If you decide to cancel your mortgage for any reason in Georgia, it's important to know how to count the three-day rescission period. When counting the days after signing the loan documents, Sundays and legal holidays are not considered part of the period. After you sign paperwork to close your loan, the next day begins your three-day right of rescission, although you can cancel the mortgage on the same day that you sign it, too. For example, if you sign on Friday, Saturday is day one, Monday is day two and Tuesday is day three. Your option to cancel will end at midnight on Tuesday.

Complaints

If your mortgage lender does not inform you of your right to rescind your loan, fails to give you the proper form to do so or does not honor your timely request to cancel, you can file a complaint. The Georgia Department of Banking and Finance has notified financial institutions licensed by the state that they must receive complaints directly from the consumer. Send your complaint by certified mail, return receipt requested, to the mortgage company. If you do not receive a response within one month, contact the Department of Banking and Finance.

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