The federal Truth in Lending Act (TILA) provides borrowers with protections and remedies against certain actions by lenders. TILA allows, in some circumstances, a borrower to rescind a loan from a lender within a three-year period from when the loan is made. However, a circuit split has developed regarding how the right to rescind must be exercised. Of the circuits that have considered this question, some require a lawsuit to be filed within the three-year period to rescind the loan. Other circuits have held that providing notice of the intent to rescind the loan within the three-year period is sufficient to rescind the loan, even if a lawsuit is not filed until beyond the three-year time limit. This Comment argues that in order to rescind the loan, courts should require that an actual lawsuit be filed before the three-year period expires.

Citation Note

This Comment was originally cited as Volume 2 of the University of Michigan Journal of Law Reform Online. Volumes 1, 2, and 3 of MJLR Online have been renumbered 45, 46, and 47 respectively. These updated Volume numbers correspond to their companion print Volumes. Additionally, the University of Michigan Journal of Law Reform Online was renamed Caveat in 2015.