According to Texas contract laws cancellation rules, the consumer is protected in a number of ways.

All deals that are not made at the seller's place of business are subject to the three-day right of rescission law. This means that if a consumer purchases something from a door-to-door salesman, at a convention center, or from a stand set up in a hotel conference room, this law applies. It does not, however, apply to purchases under the value of $25 or to transactions in which somebody buys insurance. Over and above this, it is not applicable to the purchase of farm equipment.

A consumer has until midnight on the third working day after a consumer transaction has been completed to cancel an applicable transaction. This is over and above any other remedies or rights that he or she may have.

Consumer Protection After Impulse Purchases

It is fairly common for people to get cold feet or have second thoughts after making a purchase. There are endless scenarios in which this can happen, whether the consumer has purchased a timeshare, membership to a health club, or a car. Buyer's remorse can set in after spending one's life savings on that dream sports car. In other scenarios, consumer regret can be the result of a convincing telesales pitch made to an older adult.

In another scenario, someone could have signed an apartment lease that they subsequently realize they cannot afford. Whatever the situation, consumers often find themselves in a situation in which they wish to go back on a financial decision that they have made, and in certain circumstances, they have three days in which to cancel. This is sometimes referred to as a cooling-off period.

Certain circumstances, such as the purchase of a timeshare or in a case in which the buyer has not yet taken delivery of the goods, this cancellation window may be extended slightly beyond three days.

Over and above the three-day rule, there are other forms of protection offered to consumers. If a sale in any way involved misrepresentation, duress, deception, or fraud, then there are other pieces of legislation in place to protect them. These include the Texas Lemon Law and the Deceptive Trade Practices Act, as well as other laws regarding warranty breaches and contract breaches.

Sellers' Obligations In Terms of the Law

In every situation that is covered by the three-day cancellation rule, the seller is legally required to do the following:

  • Tell you upfront about your rights when it comes to cancellation.
  • Provide you with two copies of a cancellation form.
  • Provide you with a copy of your contract or receipt.
  • Return any items that you have traded in and refund you your money within 10 working days.

Ways for Consumers to Protect Themselves

Whenever you are going to make a big-ticket purchase, there are a number of tips that you should follow in order to protect yourself:

  • Have an attorney look over the contract before you sign it.
  • Ensure that you have your own copies of all relevant documentation.
  • Make sure that everything is put in writing.
  • If you decide you want to cancel, send the cancellation papers via certified mail with a return receipt requested.

It is important for a consumer to remember that in general terms, signing a contract binds you to that deal. As a consumer, you cannot escape your contractual obligations at any time just because you change your mind. However, consumer protection laws and cooling-off periods have a very important role in certain situations.

Specific Details Regarding When Purchases Can Be Canceled

It is important to remember that Texas' right to cancel law is applicable only to purchases over the value of $25. This is applicable only to transactions that did not take place at the seller's usual premises. This means that any transaction made by a door-to-door salesman or at any premises that the seller is renting, may be canceled. If, on the other hand, a consumer purchases a car at a car dealership which is the seller's primary business premises, then right to cancel law will not be applicable.

Basic Definitions

In relation to these cancellation laws, the word consume refers to a person who purchases property or acquires credit. A consumer transaction is a transaction that involves a consumer. A merchant refers to a party who is not a consumer but is involved in a consumer transaction. A merchant's place of business refers to the main premises used by that merchant.

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