What options do I have if my mortgage lender discovered an error one of their employees did in calculating closing costs 3 weeks after the closing?

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What options do I have if my mortgage lender discovered an error one of their employees did in calculating closing costs 3 weeks after the closing?

Asked on March 29, 2012 under Real Estate Law, Arizona

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

1) If the error is to your advantage (e.g. you paid more than you should have), the lender would have to refund the extra costs--however, if the error was against you (e.g. you paid less than you should have), the lender could seek recovery of the extra money from you.

2) If you want to rescind the mortgage (i.e undo it), an error in properly and accurately disclosing closing costs can sometimes provide a basis for rescission under TILA (Truth in Lending Act). This a drastic step, since you would have to return the mortgage proceeds (the principal loaned you) under case law, and also can be complicated, since it implicates one of the more complex statutes.

Unless the amount is so trivial that the best thing to do is either pay it (if you owe it) or ignore it (if it's owed to you, but the lender is not paying for some reason), you should consult with an attorney to evaluate your options and, if appropriate, take action.


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