This ARTICLE On The Right Of Rescission Mortgage Guidelines On Refinances Was PUBLISHED On October 5th, 2019
As we have seen interest rates drop over the past month and a half, we have seen a rise in refinance mortgage transactions.
- Thousands of Americans are taking advantage of the temporary rate decrease the FEDERAL RESERVE has put in place
- It is no secret that President Trump has been tough on Chair of the Board of Governors of the Federal Reserve, JEROME H. POWELL
- Adding pressure on the Federal Reserve to cut interest rates to keep us in line with the global markets
- In the blog, we will explain the refinance timeline and detail the right to rescind and how it pertains to mortgage lending
In this article, we will cover and discuss the Right Of Rescission Mortgage Guidelines On Refinances.
Refinancing A Primary Home
Gustan Cho Associates are experts in mortgage refinancing.
- Below we will go over our refinance process step-by-step. We do our best to make this process as easy as possible on our clients
We have a friendly support staff who will keep you up to date on your refinance process.
Steps In Refinancing An Owner-Occupant Primary Home
In this paragraph, we will be talking about the steps in refinancing an owner-occupant primary residence.
- Contact Mike Gracz on 630-659-7644 or on email@example.com
- Have a one-on-one consultation about your refinance goals
- Every refinance is different
- Some clients would like to take cash out, someone to lower their term and pay the loan off sooner, some clients are interested in an FHA STREAMLINE or VA IRRRL transaction
- We offer a wide range of refinance opportunities
- After your one-on-one consultation, you will be emailed an application link and documents required to start the refinance process
- Those documents include a current mortgage statement, homeowners’ insurance declarations page (or contact information for your agent), the last two years of W-2’s (some clients will require two years of tax returns), last 30 days’ worth of pay stubs, and a government-issued photo ID
- In some cases, you will need to provide your last two bank statements (all pages)
- Complete the online application and send in the documentation above
- Once we receive your signed loan disclosures, we will then order the appraisal and title work
- Then send your file to the underwriter
- During the underwriting process, the appraiser will come to your home and complete the inspection
- At this time the loan PROCESSOR will order all required verifications
- Underwriter issues CONDITIONAL APPROVAL
- This will include what documents are needed from you to close your loan
- You will be sent a list of items to send in
- We now have all documents from you, appraisal, and title work, we will send the file back to the underwriter and issue the CLEAR TO CLOSE
- Close on your refinance. In most states, a mobile notary will come to your home (or meet you somewhere), in other states you will go to a title company
- You will sign the loan documents and now start the three-business day clock to fund
- This waiting period is called the “right to rescission” period
- After the three business days “right to rescission” period, your loan will fund, and the transaction is complete
- What is the right to rescind?
What Is The Right Of Rescission On Refinances
Now we will talk about the right to rescind after signing your closing documents.
- Keep in mind there is no right to rescind for a purchase transaction, this only pertains to refinance transactions
- The right to rescind gives the consumer the right to cancel the refinance transaction before the loan funds
Right Of Rescission Timeframe
The 3-day clock starts after ALL of the following events have occurred:
- You sign all required closing documents including Promissory Note
- You received your Closing Disclosure
- You received two notices explaining your right to rescind
The three-day clock starts the first business day after these items are received. Typically, these items are all received during the signing of the refinance documents. Business days in the mortgage industry are considered all days except Sundays and federal holidays. Saturdays do count as a business day. If the third day lands on a Saturday, your loan will not fun until the following Monday.
Right Of Rescission Mortgage Guidelines Deadline Date
However, you must rescind before midnight on that Saturday to cancel the transaction.
- If you want to rescind, you must use the form provided in the closing documents
- Make sure it is mailed or delivered before the third business day
- We recommend that you keep a copy of delivered letter and delivery time frame
- For more information, please visit the CFPB WEBSITE
- These laws were put in place by the Consumer Financial Protection Bureau to ensure borrowers are making an informed decision
- Once again, the right to rescission time frame only pertains to refinance transactions, home equity loans, or home equity lines of credit on a primary residence
The three-day clock does not apply to a second home or an investment property.
Qualifying For A Mortgage Refinance With A Direct Lender With No Overlays
There are times where clients are not aware of how much benefit a refinance can have on their financial future. We encourage you to contact Gustan Cho Associates today. Our expert loan officers will walk you through the ins and outs of refinancing. They will also provide you multiple refinance options. Depending on your current rate and equity position, we usually save our clients more money than they expected. Reach out to the Gustan Cho Associates today. Call Mike Gracz, 630-659-7644! We look forward to hearing from you.
October 5, 2019 - 5 min read