You can CANCEL a Home Equity Loan via the Truth
In Lending Act.  You have a Three Day Window to
cancel your Home Equity Loan!

Truth-in-Lending-Act Definition
Also known as the Consumer Protection Act, legislation enacted
in 1968 requiring money lenders to be explicit about the true
costs of credit transactions. 
 
The Truth in Lending Act required lenders to disclose the terms
and costs of their home equity plans, including the annual
percentage rate, points, and fees.  In general, neither the lender nor
anyone else may charge a fee until you have received this
information. 

Lenders who advertise must meet Truth in Lending Act
disclosure requirements with respect to loan rate and terms.  The
main point of interest to the borrower is that the Truth in Lending
Act provides them with the right to cancel certain real
estate lending transactions within three days. 

You Have 3 Days to Cancel
When you open a home equity loan, the transaction puts your
home at risk because if you default on the loan, the lender could
foreclose on it.  For your principal residence, the "Truth in Lending
Act" gives you three days from the day the account  was opened
to cancel the credit line.  This right allows you, the homeowner,
to change your mind for any reason.  Maybe you found better terms
or simply got cold feet.  Whatever the reason you have the right to
cancel the home equity loan.  The creditor must then cancel the
security interest in your home and return all fees - including any
application and appraisal fees - paid in opening the account.



How To Cancel Home Equity Loan
If you do decide to exercise your right of rescission, you must
inform the creditor in writing within that three day period.  You may
not rescind by telephone or in a face-to-face conversation with
the creditor.  You written notice must be mailed, filed for telegraphic
transmission, or delivered if by other written means, before
midnight of the third business day.

The creditor must then cancel the security interest in your home and
return all fees paid to open the account.  Be sure your notice is
delivered before midnight of the third business day. 

For rescission purposes, business days include Saturdays but
not Sundays or legal public holidays.

Once you cancel the contract, the security interest in your home is
also cancelled, and you are not liable for any amount, including
the finance charge. The creditor has 20 days to return all money or
property you paid as part of the transaction and release any security
interest in your home. If you received money or property from the
creditor, you may retain it until the creditor shows that your home is
no longer being used as collateral and returns any money you have
paid. Then, you must offer to return the creditor’s money or property.
If the creditor does not claim the money or property within 20 days,
you may keep it.







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