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Mortgages in the US: how the right to cancel a mortgage loan works

In general, mortgage loans in the United States entail several steps to be foreclosed, and there is, in fact, a time when the borrower can exercise his right to rescissiona prerogative that allows you to cancel the mortgage loan before it is executed.

In other words, the borrower has the right to cancel said loan, but only in the moments before signing the closing documents. —The closing of a mortgage is understood to be the moment in which all the parties sign the necessary documents to carry out the operation and initiate the disbursement of the loan funds—-.

According to information released by the Consumer Financial Protection Bureau (CPFB), the buyer has no right to cancel the loan after the closing documents have been signed.

However, it should be noted that the borrower must receive certain documents so that the closing of the mortgage is within the legality, among which is:

1) The disclosure of truth in lending.
2) The notice of right to rescind by the lender.

If as a borrower you were entitled to receive these documents and did not obtain them, there is a possibility that you can cancel the mortgage loan.

The CPFB recommends, in these cases, to consult a specialized lawyer in case you make this decision, and you must remember that you will have to return the money you have borrowed if the loan is canceled.

If I don’t agree with the terms of the mortgage agreement at closing, do I still have to sign it?

The CFPB advises all American consumers not to sign any document that contains terms with which they are not satisfied.that have aspects that you do not understand or if you believe that it has provisions that you will not be able to comply with.

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So, Before making the right to rescission, it is best that you review the mortgage loan contract with the specialized advice of a lawyer.

It should be noted that any loan application for the purchase of a home implies, in most cases, a contract with the seller of the property, and that this contract may establish a limited amount of time, as well as a certain level of flexibility, to close the sale. So, the seller of the house could subject you to legal action if you break the parameters of said contract.

The CPFB reminds you that, in case you have had a problem with your mortgage, you can contact this federal body at the number (855) 411-CFPB (2372) and file a complaint. In this way, the CFPB will communicate this complaint to the company that issued the loan and will work to find a solution to your problem.

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