Is there a law that gives me 3 days to cancel a contract, or some other amount of time?
No. The general rule is that you can not cancel a contract within 3 days of when you sign it or within any other certain amount of time. You may want to. But that does not mean you have the legal right to cancel it. BUT, there are some kinds of transactions where you can cancel the contract later if you want to. There is a federal law that gives you the right to cancel certain kinds of sales within 3 days. There are also some state laws in some states that give you cancellation rights. If none of these apply, and if no other law was broken that might give you the cancellation right, then you can not cancel the transaction or contract unless there is something written in the contract that allows for it.
What kinds of contracts can be cancelled later?
The law only allows certain types of transactions to be cancelled, and generally these must be cancelled within a 3 day period by using a special notice or form of cancellation. These include: 1.home solicitation sales (door to door), 2. sales of personal-use goods or services costing $25 or more and which occur at a place rented by the seller on a temporary or short term basis (except for arts or crafts items), 3. second mortgages on homes ("equity" home loans, bill consolidation loans and some refinancing loans, for example). Even here, if there is a right to cancel, the salesperson must tell you about it at the time of sale and must also give you 2 copies of a cancellation form to use (one to keep and one to send in to them), along with a copy of your contract or receipt. That cancellation form does not have to be on a separate piece of paper and can be a tear-off form on the sales agreement itself.
What kind of state law cancellation rights exist?
Many states have a law that applies to health clubs and dating services and spa services, and other personal service agreements. Many of those laws say that you have the right to cancel the sale within 3 days of your contract. If a state law applies, they almost always say that the seller is required to tell you about your cancellation right and give you two copies of a form to exercise your cancellation right later, if you decide to do that. Be aware that the cancellation notice they give you may be printed on the same paper as your contract as a tear-off form.
I have a 3 day cancellation right and but they never gave me a cancellation form. Can I still get out of the contract?
Yes you may. Generally, where a cancellation right exists and requires a form to be given to the consumer, if the merchant or business does not give you the form, then the time limit never starts for you to fill the form out and send it in. In that case, you should write out a short letter that says you never got the required "right to cancel" notice form and you are now notifying them that you wish to cancel. Before doing this, it would be to your advantage to talk to a local Consumer Law lawyer near you to make sure that you do it right. Some local laws require the notice to contain specific language or to be served a specific way and not complying with that could mean your cancellation notice is ineffective.
Do I have the right to cancel an online purchase within 3 days?
Generally, no. The same rules apply online as they do elsewhere in life. But if something on the web site gives you that right to cancel, then you have it. But, don't count on it.
I had a right to cancel but the store won't let me. What can I do?
Generally speaking, where you have a right to cancel and the store won't let you, then it is up to you to take the next step. You can complain to your state attorney general's consumer protection or consumer fraud office. Or you can complain to the Better Business Bureau at www.bbb.org. You can also complain by writing to the Consumer Response Center, FTC, Washington, DC 20580. If the amount is relatively small, you may also file a claim in your local small claims court.
But what if I buy something and it is defective?
Generally speaking, the retailer has to give you a refund or replacement if the item is defective. However, if your sales receipt says that there are no promises or guarantees or warranties from the seller, then the seller generally does not have to refund your money or replace the item. If it was covered by a manufacturer's warranty, however, the manufacturer may be responsible to you. But if the receipt does not deny the existence of a seller's warranty, then most states say that the seller, by law, is giving you an implied warranty of merchantability and maybe an implied warranty of fitness for use too. That means the product is guaranteed to do what they said it would do and if the seller picked it out for you or said it would do what you were looking for then they are giving you a guarantee that it will. Two things matter here - what the seller said and what the sales receipt says. This area can be complex, so you may want to consult a local attorney for guidance.
If I pay with my credit card, can I dispute the charge later?
Yes. If you buy an item that was defective or not as it was represented to be, then you have certain credit card rights. You must notify the credit card company that you want to dispute the charge by sending a written notice to the address for billing disputes that appears on your billing statement within 60 days of the bill. The credit card company must then investigate your problem and notify you of the result. You don't have to pay the disputed amount of the bill until it is resolved but you do have to pay the rest of your bill.
Additional resources provided by the author
To help you understand more about the federal 3 day right to cancel some contracts, here are a few links to other web site pages. If you have a problem with enforcing your cancellation notice, or aren't sure that the law covers you, check the link below for a 50-state National List of Consumer Law lawyers and find one near you (lawyers don't pay to be put on this list and most of them are members of the only national organization of Consumer Law lawyers, Naca.net).
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