Breaking up isn’t that hard to do: a letter is enough to rescind mortgage, Supreme Court rules

Home buyers aren’t required to file a lawsuit to back out of a mortgage when the lender has violated the Truth in Lending Act, the Supreme Court has ruled, according to a recent article in The Columbus Dispatch. The unanimous decision “came in a case involving Larry and Cheryle Jesinoski, a Minnesota couple who refinanced their home in 2007 with Countrywide Home Loans, Inc., now part of Banc of America Corp.” The couple claims the company did not provide some disclosures required under federal law, so they “sent a written notice of rescission within three years after the loan closed.” A federal judge ruled against them, saying they should have filed a lawsuit instead of sending a letter, and the 8th U.S. Circuit Court of Appeals upheld that decision. Writing for the court, Supreme Court Justice Antonin Scalia said that the law does not specify how the borrower must exercise the right to rescind, and that mailing a notice before the three-year deadline “is all that a borrower must do in order to exercise his right to rescind.” For more, read the full article

Case Law Summary, Consumer Lending and Services, Federal News, Non-Depository Institutions