Many states have laws (statutes) that allow a consumer to cancel a contract or sale made at the consumer’s home, at the home of another person (at an in-home sales party), or at another place that is not the seller’s permanent place of business. A consumer’s right to cancel such a home-solicitation contract is also known as a right to rescind the contract, or a cooling-off rule, and is based on the belief that a consumer is more vulnerable to high pressure sales tactics in such settings, as it is more difficult for the consumer to walk away from the salesperson.
Such buyer’s remorse laws governing a consumer’s right to cancel a sales contract vary from state to state, but the seller generally must give a copy of the contract to the consumer at the time the contract is signed, and it must include a written statement of the consumer’s right to cancel and the proper means of giving the seller notice of the cancellation of the contract.
Under some state laws a consumer does not have the right to cancel such a contract if the consumer requests the seller provide the goods or services without delay in an emergency situation—to protect the health, safety, or welfare of persons, or to prevent damage to the consumer’s property.
The Federal Trade Commission (FTC) also has a cooling-off rule that gives consumers the right to cancel a sale within three days if the sale was made at someone’s home or workplace, or at a seller’s temporary location, such as a hotel room, convention center, fairground, or restaurant. Under the FTC’s Cooling-Off Rule, a seller must inform a consumer of the consumer’s right to cancel at the time of sale, and must give the consumer two copies of a cancellation form and a copy of the contract or receipt. The consumer’s right to cancel for a full refund extends until midnight of the third business day after the sale. The consumer does not have to give a reason for canceling the purchase. There are exceptions to the FTC’s Cooling-Off Rule.
In Texas, consumers have the right to cancel certain sales contracts under the state's regulation for home solicitation sales, which aligns with the Federal Trade Commission's (FTC) Cooling-Off Rule. This rule applies to sales made at a consumer's home, at someone else's home, or at a location that is not the seller's permanent place of business. Texas law requires that the seller provides the consumer with a copy of the contract at the time of signing, which must include a statement of the consumer's right to cancel. The consumer has until midnight of the third business day after the sale to cancel for a full refund without needing to provide a reason. The seller is also required to provide two copies of a cancellation form and a copy of the contract or receipt. However, the right to cancel does not apply if the consumer has requested immediate delivery of goods or services in an emergency situation that affects health, safety, welfare, or to prevent property damage. It's important for consumers to be aware of these protections to avoid being pressured into unwanted purchases.
