The fine print may not be so fine after all.  Joe was sure he could get out of his high-rate mortgage because federal law requires borrowers receive notice they have the right to rescind or cancel a transaction within three business days and, if that notice isn’t given, they have up to three years to rescind the deal.  In the documents Joe signed, the transaction date and the three-day deadline date had been left blank.  But the Court of Appeals for the First Circuit held it was just a technical mistake since the date of the transaction was stamped on the upper right corner and the text said the borrower had three business days to rescind.  Other Circuits have held that even the most minor technical flaw triggers the three-year rescission privilege.  But the Court said if Mel had read the document, he would’ve seen the date of the transaction and could have easily counted three days forward.  So unless the Supreme Court writes the final word, Joe is out of luck.  A little thing did in the little guy, and it looks like the fine print is fine for them, but not fine for you.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Melfi v. WMC Mortgage Corp., First Circuit Court of Appeals, No. 09-1066, Boudin, J., U.S. Law Week, Vol. 77, No. 50, Pg. 1813, 6-30-09

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