Real Financial Solutions

The act clearly states that the homeowner may rescind the foreclosure consulting agreement at any time; that the homeowner may rescind a foreclosure purchasing transaction within three days; and that the homeowner has until ten days after the final accounting of a foreclosure sale to rescind a foreclosure surplus purchase transaction.  What is not clear is what happens if the property is sold to an end buyer with no promise of a reconveyance?

The answer lies in the text of the required notice of the foreclosure consulting agreement found in RP §7-306(5):

. . . If a transfer of the deed or title to your property is involved in any way, you may rescind the transfer any time within 3 days after the date you sign the deed or other document of sale or transfer. . .

Clearly, if a homeowner is selling a residence in foreclosure as defined by the law, that homeowner has three days after he signs the deed to rescind the transaction regardless of whether there is a reconveyance involved or not.

This is critical for you to know because many title producers have been advised by their title insurers that this act does not affect their settlement practices.  It is up to you to ensure your title company is aware of this rescission right.  If the title company records the documents during the rescission period, they will not be the ones prosecuted for violating the law.  It will be the buyer who is prosecuted.