Rescission: The Ins and Outs

For more information please call 954-495-9867 or 520-405-1688.

My administrative assistant is Susan Rose. She speaks for me but she is not a lawyer and cannot answer legal questions. This blog and the included articles are not legal opinions on any specific case and should never be used as a substitute for advice from a knowledgeable attorney who is licensed in the jurisdiction in which the property is located.

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So due to scheduling conflicts I can’t do the radio show tonight. Sorry. But here is what I will cover next week along with some late=breaking news regarding MERS and damage cases against the banks, servicers and their lawyers.

RESCISSION: I have received hundreds of requests and questions. It boils down to one thing — the rescission IS EFFECTIVE the moment it is dropped in the mail. People, lawyers and even Judges seem not to understand what that means despite a very terse snip from Justice Scalia speaking for an unusually unanimous Supreme Court in Jesinowksi. What it means is that the deal is done, canceled, rescinded (stick a fork in it). And what it also means is that the time starts to run on the duties of the “lender(s)” to comply with that cancellation/rescission. Telling you in a letter that you had no right to send it is NOTHING, as a matter of law.

So whether you were right or wrong when you sent the notice of rescission the deal was canceled. Anyone who interprets it differently is doing two things that are wrong: (1) interpreting that which is clear and ruled upon by the highest court in the land and (2) getting it exactly wrong.

There is no other interpretation of “effective” because the Supreme Court under the annoyed pen of Justice Scalia has said there is nothing to interpret. When the rescission was mailed it was effective BY OPERATION OF LAW.

During the 20 days, the duties of the “lender” or “creditor” are clear: (1) return the canceled note (2) file a satisfaction of mortgage and (3) return all money paid by borrower. If the banks fail to do that they have violated the statute. If anyone takes issue with whether the rescission should be effective this way, they would need to file a lawsuit within the 20 days allowed for performing the duties under TILA (see above). If they want to say the statute of limitations has run, they must do it in a lawsuit filed within the 20 days. Otherwise the window closes. If they want to say it was a purchase money mortgage and that the borrower rescinded a loan that could not be rescinded under TILA, they must do it in lawsuit filed within the 20 days. There are questions of fact in all these “defenses” as to whether it was really beyond the statute of limitations or really a purchase money mortgage (when coupled with a HELOC etc).

Everyone is having trouble with this after years of incorrect rulings from thousands of courts “interpreting” the statute (which was clear and thus not subject to interpretation). So here it is:

IF NOTICE OF RESCISSION IS SENT THE LOAN IS OVER AND THE NOTE AND MORTGAGE ARE VOID BY OPERATION OF LAW — NO LAWSUIT OR TENDER OF MONEY OR PROPERTY REQUIRED. PERIOD.

It apparently seems too simple, too powerful for people to accept. In one punch they could flatten a trillion dollar giant? The answer is yes. Stop over thinking this. Our rescission package analyzes your loan and gives you options and ways to utilize rescission and related actions to enforce rescission and quiet title. After 20 days the deal is over and no longer subject to attacking the rescission. But we know the Banks, servicers etc. are going to try to “defend” after the 20 days. So you need to know how the effects of rescission can be jammed down their throats and how it automatically frees your property from the encumbrance of the mortgage —regardless of whether or not anyone actually filed the satisfaction of mortgage. In fact, the statute bars any action by the “lender”until they have complied totally with the three duties outlined above.

Get it? If not, tune into the Neil Garfield Show next week.

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