Grace Period to Back out of a Refinance

Do I have a 3 day grace period to back out of a refinance?

1 Answer

If you refinanced your primary residence, you have a three day rescission period and during this time you can in fact cancel your loan request if you feel as though you didn't receive a fair rate, charged excessive fees, etc. 

You have three business days after the day of closing to sign the cancellation form you received in your copy of the documents at your closing.  So if you signed on a Monday, you have until Thursday evening, Tuesday closings have until Friday night, etc.  You return this form to the title/escrow/ abstract company at which you closed and they will forward the cancellation request to the loan company effectively terminating your loan. 

Before doing so, please read all of your documents closely, review all of the information you received during the loan process to make sure cancelling your loan doesn't put you in a position to be responsible for additional fees, etc. 

You should also be able to go back to your loan officer or his company, or even the closing agent and ask questions about the documents you signed during this period and if you don't receive the answers you are looking for, you are within your rights as a borrower to execute the cancellation and terminate the loan.  Better to start over than to be taken to the cleaners on your mortgage!

I hope this helps.