If you`ve recently signed a contract and realized that you`ve made a mistake, don`t worry. The “three-day rule” may be on your side.
Many consumers are unaware that federal law gives them the right to cancel certain contracts within three business days. This protection is often referred to as the “cooling-off period.”
The Federal Trade Commission (FTC) created the three-day rule to protect consumers from high-pressure sales tactics and fraudulent companies. If a consumer changes their mind about a purchase shortly after signing a contract, they can cancel the agreement without any penalty.
However, it`s important to note that not all contracts are eligible for cancellation. The FTC`s cooling-off period only applies to contracts signed in the consumer`s home, workplace, or at a seller`s temporary location, such as a trade show booth or fairground.
Contracts for goods or services that cost more than $25 must also be eligible for cancellation. This includes contracts for home improvement services, car purchases, and certain financial services like credit repair.
To cancel a contract within the three-day window, consumers must notify the seller in writing. This can be accomplished by mail, email, or by hand-delivering a cancellation notice to the seller`s office. The notice must clearly state the consumer`s intention to cancel the contract and be received by the seller before the end of the third business day.
If a consumer cancels a contract within the cooling-off period, the seller must refund any money paid and return any items exchanged as part of the agreement.
It`s important to note that the cooling-off period only lasts for three business days. If a consumer misses the deadline, they may be bound to the terms of the contract and unable to cancel the agreement without penalty.
The three-day rule is a valuable tool for consumers who may have been pressured into signing a contract or who didn`t have enough time to fully review the agreement. If you find yourself in this situation, take advantage of your rights and cancel the contract within the allotted time frame.