When facing foreclosure, many homeowners look for ways of saving their homes. There are a number of laws in place that are designed to protect homeowners in certain scenarios but knowing whether your mortgage company is in violation of these laws takes a bit of understanding of the laws in general. Knowing a bit about the Truth in Lending Act can help you to better understand your rights as a homeowner and potentially stop your mortgager from illegally foreclosing on your home.
The TILA is designed to ensure that consumers know exactly what their loan terms state. This is a federal law pertaining the consumer protection and it requires that lenders provide certain disclosures to those buying a home. Disclosures will inform the buyer of various rights such as the right to cancel the loan agreement process within three days of signing. If the mortgage company or bank fails to disclose this information to the buyer, they have violated the Truth in Lending Act.
The act also allows for cancellation of predatory loans for some scenarios. The home buyer has the right to cancel the entire loan process within three days of when the signing takes place. If the lender does not inform the home buyer of this right when the loan agreement is signed, the home buyer has up to three years to rescind the loan agreement. Filing for bankruptcy may allow the homeowner to extend this rescission deadline for an additional period of time.
If a homeowner chooses to rescind the loan agreement, he or she must provide written notice of this decision to the lender. This written notice however will not automatically stop the loan agreement. The bank is required to rescind the loan agreement as per the homeowner?s wishes and most do but if the agreement is not rescinded then the homeowner will need to file suit against the loan company and the case will go to court. Lawsuits pertaining to these cases have to be filed within the first three years of the date that the original document was signed.
Understanding the Truth in Lending Act can be difficult. If and when a homeowner feels that their mortgage company has violated their rights pertaining to this act, they should contact an attorney who specializes in real estate law to see what should be done. An experienced attorney can help the homeowner to file the proper claim and ensure that they are within their rights to rescind the loan agreement.
Source: http://www.astrablegal.com/understanding-the-truth-in-lending-act.html
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