From GG: Great Case law on TILA (Truth in Lending Act) and recission of a bad mortgage or mortgage servicer

see Barnes v Chase 9th Circuit RESCINDED and Remanded NOT for Publication 13-35716
Causey v US Bank 9th Circuit RESCINDED and Remanded NOT for Publication 10-56021
Here we find some amazing rulings from the Ninth Circuit. One pre-Jesinoski, and the other post Jesinoski …
Causey v. US Bank (2011) [3 day rescission decided pre-Jesinoski]
But in a case where the creditor acquiesces in the
consumer’s notice of rescission or fails to respond within the 20-day response period, rescission is accomplished automatically. See id.
Barnes v Chase (8/10/2017)
Check this ruling out:
For reasons that are unclear from the record, the letter to the creditor was returned to Barnes undelivered. The loan was not rescinded, and Barnes brought suit for rescission and violation of the Truth in Lending Act (TILA), 15 U.S.C. § 1601 et seq., and its requirements regarding rescission procedures against CBUSA, CHF, and LBPS.1 The district court granted the defendants’ motion for summary judgment. Because notice of rescission was properly given, we vacate the grant of summary judgment on Barnes’s claims for rescission and failure to effect
rescission and remand for further proceedings.2
Specifically, Consumer Financial Protection Bureau (CFPB) Official Staff
Commentary to Regulation Z provides: “Where the creditor fails to provide the consumer with a designated address for sending the notification of rescission delivery of the notification to the person or address to which the consumer has been directed to send payments constitutes delivery to the creditor or assignee.” 12 C.F.R. § 226, Supp. I, para. 23(a)(2); Truth in Lending, 69 Fed. Reg. 16,769-03,
16,771 (Mar. 31, 2004).


CBUSA “fail[ed] to provide [Barnes] with a designated address for sending the notification of rescission” because the address it did provide was not successfully receiving mail when Barnes sent his notice there. See 12 C.F.R. § 226, Supp. I, paras. 15(a)(2), 23(a)(2). The only remaining action for Barnes to take, per Regulation Z and the CFPB Official Staff Commentary, was to notify the servicer, which he had already done.


U.S. Bank N.A. v. Naifeh (Cal. Ct. App. 2016) 1 Cal.App.5th 767, 769: “[A] timely notice of rescission automatically renders the security interest void under section 1635(b) where the creditor acquiesces in the rescission or ignores it.

Merritt v. Countrywide Fin. Corp. (9th Cir. 2012) 759 F.3d 1023, 1030 [under the procedure set forth in 15 USC 1635(b), “‘all that the consumer need do is notify the creditor of his intent to rescind,’” and the “‘”agreement is then automatically rescinded”‘”]; Sherzer v. Homestar Mortgage Services (3rd Cir. 2013) 707 F.3d 255, 258 [“rescission occurs automatically when the obligor validly exercises his right to rescind;” Williams v. Homestake Mortgage Co. (11th Cir. 1992) 968 F.2d 1137, 1140 [agreement “automatically rescinded” when consumer notifies the creditor of his intent to rescind] and of course Jesinoski.

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