Cooling Off Period

A cooling off period is time allowed under law to enable a consumer to cancel an agreement without incurring any penalty. In consumer credit, the cooling off period permitted by the Consumer Credit Act 1974 and its subsequent enhancements is 14 days.

If you enter a non-credit related agreement at your home, other law permits a cooling off period of 7 days.

If you buy anything over the internet, by mail order, or by phone, under the Distance Selling Regulations the cooling off period is also 7 days, but commence on the day after you agree to take the goods or service.

If you are entitled to cancel a credit agreement, you must be sent a cancellation notice within the cooling off period explaining that you have the right to cancel the agreement. A cancellation form will be enclosed with the notice and you can use this (or write a letter) to cancel the agreement. Should you decide to cancel, the cancellation must be sent to the lender within five days of receiving the notice, preferably by recorded delivery. A telephone call will not normally be sufficient.

It`s worth noting is that if the trader has failed to provide you with the required information about your right to cancel, then the cooling-off period will be longer. You may require legal advice on this issue. Always check the terms and conditions of the contract.

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