The FTC Cooling-Off Rule gives consumers three business days to cancel certain sales made at their home, workplace, dormitory, or a seller's temporary location (hotel rooms, convention centers, fairgrounds, restaurants). This protection exists because high-pressure sales environments do not give consumers adequate time to evaluate purchases.
7 steps across 1 sections
1. Exemptions (Rule does NOT apply to)
- Sales made at the seller's permanent place of business
- Sales under $25 (at home) or $130 (temporary locations)
- Real estate, insurance, or securities transactions
- Arts and crafts sold at fairs (but training courses at fairs ARE covered)
- Automobile sales at temporary locations (if seller has at least one permanent place of business)
- Emergency home repairs you requested
- Sales made entirely by mail, phone, or online
Common Mistakes
- Not knowing the rule exists (many consumers do not realize they can cancel)
- Missing the 3-business-day deadline
- Not canceling in writing (verbal cancellation may not be enforceable)
- Not using certified mail (harder to prove you canceled on time)
- Assuming all purchases are covered (many exemptions exist)
Pro Tips
- If the seller did not give you cancellation forms or inform you of your right...
- Some states have longer cooling-off periods than the federal 3-day rule — che...
- The rule applies to home improvement sales, which are a common source of cons...
- If a seller tells you the cooling-off rule does not apply when it does, repor...
- Always take time to read contracts carefully before signing, even within the ...