Federal holidays do not count in the rescission period on a mortgage. Regulation Z uses a special calendar-based definition of “business day” for the three-day right to cancel: every day counts except Sundays and the eleven federal holidays listed in 5 U.S.C. 6103(a).{1eCFR. 12 CFR 1026.2 – Definitions and Rules of Construction} Saturdays, on the other hand, do count, which is where most borrowers miscount.
The Special Business Day Rule for Rescission
Regulation Z actually defines “business day” two different ways. The general definition looks at whether the lender’s offices are open. The rescission definition ignores the lender entirely and looks only at the calendar: every day is a business day except Sundays and the federal holidays named in the statute.{1eCFR. 12 CFR 1026.2 – Definitions and Rules of Construction}
The practical effect is that your lender’s hours can’t shorten or lengthen your window. If the branch happens to be closed the day after Thanksgiving, it doesn’t matter. The countdown runs on the calendar.
Saturdays Count, Sundays Don’t
Because the rescission definition treats every calendar day as a business day except Sundays and the eleven holidays, Saturday is always a business day for this count, even if your lender is closed. Close on a Friday and Saturday is day one, regardless of who is working.
Sunday is always excluded. The clock skips every Sunday and picks up on Monday (assuming Monday is not a federal holiday). So a borrower who closes on a Thursday would count Friday as day one, Saturday as day two, skip Sunday, and have until midnight Monday to cancel.{1eCFR. 12 CFR 1026.2 – Definitions and Rules of Construction}
The Eleven Federal Holidays That Are Skipped
These are the holidays that don’t count toward your rescission period:
- New Year’s Day (January 1)
- Birthday of Martin Luther King, Jr. (third Monday in January)
- Washington’s Birthday (third Monday in February)
- Memorial Day (last Monday in May)
- Juneteenth National Independence Day (June 19)
- Independence Day (July 4)
- Labor Day (first Monday in September)
- Columbus Day (second Monday in October)
- Veterans Day (November 11)
- Thanksgiving Day (fourth Thursday in November)
- Christmas Day (December 25)
The list comes from 5 U.S.C. 6103(a), which Regulation Z incorporates by reference.{2Office of the Law Revision Counsel. 5 USC 6103 – Holidays} Regulation Z’s own text uses “such as” before its examples and hasn’t been updated to name Juneteenth, but Juneteenth is still excluded because the regulation defers to 6103(a), not to its own illustrative list.{3Federal Register. Truth in Lending (Regulation Z) Impact of the 2021 Juneteenth Holiday on Certain Closed-End Mortgage Requirements} State holidays, local government closures, and bank holidays don’t affect the count. Only these eleven.
When a Holiday Lands on a Weekend
Five of the eleven holidays are fixed to a calendar date rather than a weekday: New Year’s Day, Juneteenth, Independence Day, Veterans Day, and Christmas Day. When one of those dates falls on a Saturday or Sunday, the observed date the federal government uses for pay and leave doesn’t match what Regulation Z uses.
Holiday on a Saturday
When one of those five holidays falls on a Saturday, federal offices typically observe it on the preceding Friday. For rescission purposes, that observed Friday is still a business day and counts toward your three days.{4Consumer Financial Protection Bureau. 1026.2 Definitions and Rules of Construction} The Saturday itself is excluded, because that is the date the statute names.
Holiday on a Sunday
Sunday is already excluded whether or not a holiday falls on it. When the government observes that holiday the following Monday, the Monday still counts toward your rescission period. Regulation Z references the dates in 5 U.S.C. 6103(a) itself, not the shifted observance dates in 6103(b), which apply to federal employee pay and leave.{2Office of the Law Revision Counsel. 5 USC 6103 – Holidays} If Christmas falls on a Sunday, the following Monday (December 26) is day one even though banks and government offices are closed.
Two Worked Examples
Say you close on Friday, June 1, and your lender delivers all required disclosures and rescission notices the same day. The clock starts the next day:
- Saturday, June 2 — day one
- Sunday, June 3 — skipped
- Monday, June 4 — day two
- Tuesday, June 5 — day three; your right expires at midnight
Now the same closing on Wednesday, July 2, with all documents delivered that day:
- Thursday, July 3 — day one
- Friday, July 4 — skipped (Independence Day)
- Saturday, July 5 — day two
- Sunday, July 6 — skipped
- Monday, July 7 — day three; your right expires at midnight
The CFPB’s official commentary confirms the method: three business days from whichever of closing, delivery of material disclosures, or delivery of the rescission notice happens last.{5Consumer Financial Protection Bureau. 1026.23 Right of Rescission}
When the Clock Actually Starts
Miscounting the start date will throw off every holiday calculation, so this piece matters. Three events have to happen before the countdown begins, and the clock starts the day after whichever one occurs last:
- Consummation of the loan (when you become contractually obligated, generally at signing, as determined by state law){}6eCFR. 12 CFR 1026.2 – Definitions and Rules of Construction
- Delivery of the material disclosures: annual percentage rate, finance charge, amount financed, total of payments, and payment schedule{}7eCFR. 12 CFR Part 1026 Subpart C – Closed-End Credit
- Delivery of two copies of the rescission notice to each borrower with an ownership interest (one copy per borrower if delivered electronically under the E-Sign Act){}5Consumer Financial Protection Bureau. 1026.23 Right of Rescission
The day the last of these three happens is effectively day zero. Day one is the next calendar day, subject to the Sunday and holiday exclusions above. If disclosures arrive on a Friday but the rescission notice isn’t delivered until Monday, day one is Tuesday.
Timing of your cancellation follows a mailbox rule: your written notice counts when you mail it, not when the lender receives it. Drop the letter in the mailbox Tuesday evening before midnight and you’ve met a Tuesday deadline even if it arrives Thursday.{8eCFR. 12 CFR 1026.23 – Right of Rescission}
Loans Without a Right to Rescind
The holiday counting rules only matter if your loan carries a right of rescission at all. Purchase-money mortgages on your principal dwelling are not rescindable, and neither is the refinanced portion of a loan refinanced with the same creditor (though new money above the existing balance and refinancing costs is).{9Consumer Financial Protection Bureau. Comment for 1026.23 – Right of Rescission} The right applies only to credit secured by the home you actually live in, not investment properties or vacation homes.