Jesinoski v. Countrywide Home Loans, Inc.
574 U.S. 1015 (2015) — Supreme Court of the United States (2015)
Facts of the Case
Larry and Cheryle Jesinoski refinanced their home in February 2007. Exactly three years later — in February 2010 — they sent Countrywide a Notice of Rescission under TILA, seeking to void the loan for disclosure violations. Countrywide refused to honor the rescission, arguing that TILA's three-year window requires the borrower to FILE A LAWSUIT within three years — merely sending a notice is not enough. The Jesinoskis sued on February 24, 2011 — more than four years after closing. The district court dismissed, holding the lawsuit was untimely because the three-year period for filing a lawsuit had expired.
Legal Issue
Under TILA's extended right of rescission (15 U.S.C. § 1635(f)), must a borrower FILE A LAWSUIT within three years of closing to exercise rescission — or is sending a written Notice of Rescission sufficient?
Court Holding
The Supreme Court unanimously held (9-0) that a borrower exercises the right of rescission by SENDING WRITTEN NOTICE within three years — filing a lawsuit is NOT required to exercise the right. The Court held that TILA's plain text says the right of rescission is exercised by 'notifying the creditor,' not by filing suit. The notice is the exercise; the lawsuit is the enforcement mechanism. This means: (1) send the Notice of Rescission within 3 years of closing via certified mail, and (2) the lender must respond within 20 days by returning fees, terminating the security interest, and releasing the mortgage. If the lender refuses, you sue to ENFORCE the rescission — but the limitations period for enforcing may extend beyond the 3-year window.
Why This Case Matters
Jesinoski is the most important TILA rescission case for homeowners. Before Jesinoski, lenders routinely argued that homeowners had to sue within 3 years — a requirement that made TILA rescission nearly impossible to exercise for anyone who discovered the violation near the deadline. Jesinoski confirmed: send the notice. If the lender refuses, the notice is still valid — now you sue to enforce. The deadline to send the NOTICE is 3 years; the deadline to FILE SUIT to enforce the rescission after the lender's non-compliance is governed by state contract/equitable limitations periods, which may be longer.
Impact on Homeowners
If you discover TILA disclosure violations within 3 years of closing your refinance (purchase loans are not subject to rescission), send a Notice of Rescission immediately via certified mail. Do not delay to prepare a lawsuit — the notice IS the exercise. Once the notice is sent, the lender has 20 days to respond. If they ignore you or refuse, you can then sue to enforce the rescission. Jesinoski gives homeowners the breathing room to exercise TILA rescission without simultaneously filing a complex federal lawsuit.
Related Resources
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Frequently Asked Questions
Does Jesinoski mean I can rescind any loan within 3 years?▼
What if the lender ignores my rescission notice?▼
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