Mellon Mortgage Co. v. Allen

A-1882-99T2 (N.J. Super. App. Div. 2001) (Unpublished)

Opinion Date: January 3, 2001
Real Property Law
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MORTGAGES; TRUTH-IN-LENDING—The truth-in-lending rescission period expires after three years and cannot be used thereafter as a defense to a foreclosure action.

In 1987, homeowners refinanced their original mortgage, giving the lender a note and a new mortgage. Eleven years later, after one or more payments went unmade, a foreclosure action was filed. In defense to the action, the homeowners sought to argue that the original disclosure statement signed by them in connection with the refinance was in violation of the Truth In Lending Act. The Court struck the answer and defense because the Truth In Lending rescission period expires after three years. Even though the homeowners may have the right to ask the Federal Trade Commission Bureau of Consumer Protection for relief, such a deficiency in the disclosure is not a defense to a foreclosure action after the passage of more than three years.

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