I recently considered replacing some carpet in my home, and my first call was to one of the companies that offers at-home appointments where they’ll measure the space, show you samples and provide quotes on the spot.
The salesman who came to my house was talented. Even though the quote was about 300% more than I hoped to pay, he had an answer to my every sales objection. He repeatedly cut the price. He asked me how low it would have to go for me to sign a contract on the spot (then called his manager for approval to drop it even further). Then he casually mentioned, "Plus, if you sign a contract now, the Federal Trade Commission rules say you legally have the right to cancel it within three days at no cost to you. That gives you time to sleep on it."
I signed a contract on the spot–after all, I could cancel it!–and immediately after he left, I had second thoughts. I hadn’t comparison shopped. The final price was still more than I’d budgeted. After doing a bit more research, I decided to cancel the order. But first I wanted to research the Federal Trade Commission’s Cooling-Off Rule.
The rule gives you three business days to cancel a purchase of at least $25 if you made the purchase at home or another location that isn’t the seller’s permanent place of business. The sales person must tell you about your cancellation rights when you make the purchase, the contract or receipt must include the cancellation policy, and the sales person must give you two copies of the cancellation form.
Some types of purchases are exempt from the cooling-off rule. These include:
- Phone and mail-order purchases
- Purchase that aren’t intended for personal, family or household use
- Purchases that were negotiated at the seller’s permanent place of business, even if the contract was signed elsewhere
- Real estate, securities, insurance, motor vehicle, and arts and crafts purchases
- Home maintenance and repairs
- Purchases related to emergencies
In my instance, the salesman told me about the cancellation policy, but didn’t give me copies of a cancellation form and the contract didn’t include cancellation language. (In fact, it said that the contract couldn’t be cancelled.) I was a little concerned about whether I’d actually be able to cancel the contract, but I took a few steps to ensure that the purchase was cancelled.
First, I called the carpet company and told them I’d like to cancel the order per the FTC’s three-day cooling off rule. The man I spoke to assured me that the order would be cancelled, and I asked him to email or fax written confirmation of the cancellation to me.
I also checked with my credit card to see if the deposit I’d paid had been refunded. After two business days, no sign of a refund appeared, so I wrote a letter to the company, and included a copy of cooling-off rule from the FTC’s website. In the letter, I included my order number, detailed my conversation with the person who confirmed my cancellation and referenced the FTC cooling-off rule. I sent the letter certified mail, and ensured that it was postmarked within three business days of my purchase.
About a week later, I had my refund.
If you unsuccessfully try to get a refund that you’re entitled to under the FTC’s cooling-off period, you should contact the FTC at Consumer Response Center, Federal Trade Commission, Washington, DC 20580. You should also see if your state has its own cooling-off rule, because state consumer protection agencies may also be able to assist you.
If you made a partial or complete payment using a credit card, contact the card issuer to see if you can dispute the charge.
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