mortgage

Law gives 3 days to cancel refi or HELOC

That paper should tell you who you have to contact if you want to rescind your loan, along with any information you should include and where your rescission notice should be sent, says Justin Anderson, staff attorney with the National Credit Union Administration.

If you want to rescind the transaction, you have to do it in writing, by either mail or fax. Your letter doesn't have to be received or postmarked within the three-day window. It simply must be mailed within that period, Anderson says. "You have to state that you are rescinding the transaction for whatever property it is," he says.

Though not required, it's a good idea to send your rescission letter or notice in a way that proves when it was sent and that it was received, Reynolds says.

The right of rescission clock

The right of rescission gives you three days to back out of a deal. And the clock starts either when you close on the loan or when you get your loan disclosure documents -- whichever comes later. But, as with many things legal, those three days aren't simply 72 hours.

First of all, the regulation specifies three business days. And it includes Saturday as a business day, even if the lender is closed.

What it doesn't count as a business day: Sunday and any legal holidays.

That clock starts ticking at midnight after you signed the loan, and proceeds until midnight three days later (excluding any Sundays or pesky holidays).

For example: If you signed your loan on 2 p.m. Thursday, your right of rescission would expire at midnight Tuesday (or to put it another way, Monday when the clock passes 11:59 p.m.).

But, in at least one instance, the rescission clock could run much longer than three days.

If you didn't receive the proper disclosures at closing, then the clock never started in the first place, Saunders says. In that case, you have three years from the date of closing to rescind your loan.

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