How many days does a borrower have to rescind a mortgage loan under TILA?

Under the Truth in Lending Act (TILA), a borrower has three business days to rescind a mortgage loan. This right of rescission applies to certain types of loans, particularly those involving a borrower's primary residence. During this three-day period, the borrower can cancel the loan agreement without penalty, allowing them to change their mind if they reconsider the terms of the loan after closing. This consumer protection measure is designed to give borrowers sufficient time to review the loan terms and ensure it fits their financial situation.

The three-day period starts from the later of the date of the loan closing or the date the borrower receives the disclosure documents required by TILA. It's important for borrowers to be aware of this benefit, as it provides them a crucial opportunity to reconsider their decision without facing consequences.