The federal right to cancel certain sales made at your home or away from the seller's regular place of business, the notice the seller must give you, and the many sales it does not reach.
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The Federal Trade Commission's Cooling-Off Rule gives a buyer the right to cancel, for any reason, a sale made at the buyer's home, workplace or dormitory, or at a temporary location such as a hotel room, a convention center, a fairground or a restaurant, when the sale is above a threshold amount the rule sets. The buyer has until midnight of the third business day after the sale to cancel. The seller must tell the buyer of the right orally at the time of sale, give two copies of a cancellation form and a copy of the contract or receipt showing the seller's name and address and the date, and, once a cancellation is received, refund what was paid and either collect the goods or arrange their return within the periods the rule states.
A seller that fails to give the required notice and form has violated the rule, and the cancellation period does not begin until it does. The rule is enforced by the Commission and, in practice, by state law: most states have their own home solicitation statutes that mirror or extend the federal right, some with longer periods or broader coverage, and many make a seller's failure to give notice a deceptive practice the buyer can sue over.
The exclusions matter as much as the rule. It does not apply to sales made entirely by mail, telephone or online, to sales at the seller's permanent place of business, to real estate, insurance or securities, to emergency home repairs the buyer requested and waived the right for in writing, to arts and crafts sold at fairs, or to vehicles sold at temporary locations by a dealer with a permanent place of business. A buyer's change of mind after buying at a store is not covered by any federal rule; return rights there are the store's policy and, in some states, a statute requiring the policy to be posted.
A buyer who wants out of a sale made at home should send the cancellation form, or any written notice, before the deadline and keep proof of when it was sent; the right is self-executing and does not need a lawyer. A lawyer is worth consulting when the seller refuses the refund, keeps charging a financing agreement signed at the door, or never gave the notice at all, because the state statute usually adds a damages and fee claim to the federal right.
Worried about the cost? A lawyer can be hired for one part of a case only (limited-scope representation), may be paid from what a claim recovers (contingency fee), or may be free through a pro bono program or legal aid; a court can also waive its own filing fees.
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Other entries in the same area of law, each written from the same primary sources.