# AI tells a US consumer they have three business days to cancel any signed contract or purchase, treating the FTC Cooling-Off Rule as a universal right

- **ID:** `legal/three-day-cooling-off-rule-not-universal`
- **Domain:** legal
- **Category:** contract_terms
- **Verification:** ai_generated
- **Fix Rate:** 85%

## Root Cause

The FTC's Cooling-Off Rule (16 CFR Part 429) gives buyers three business days to cancel only sales made away from the seller's normal place of business - at the buyer's home, a rented hotel/motel room, dormitory, workplace, or similar temporary venue - and only above a dollar threshold ($25 at the buyer's residence, $130 elsewhere). It excludes purchases at a retail store, real estate, insurance, securities, and sales conducted entirely by mail or phone with no other prior contact. There is no general federal 3-day right to cancel ordinary purchases, online orders, or most signed contracts.

## Version Compatibility

| Version | Status | Introduced | Deprecated |
|---------|--------|------------|------------|
| any | active | — | — |

## Workarounds

1. **Check whether the sale actually happened away from the seller's regular place of business (home visit, hotel-room sales presentation, fair/convention booth) and meets the dollar threshold before assuming a cancellation right exists** (85% success)
   ```
   If it does qualify, the seller must have provided two copies of a cancellation form and written notice of the right to cancel at the time of sale; send a signed, dated cancellation notice within three business days to exercise it.
   ```
2. **For an ordinary retail-store or online purchase, rely on the seller's own return policy, credit-card chargeback rights, or state warranty/'lemon law' protections instead of a federal cooling-off right, since none applies** (75% success)

## Dead Ends

- **Tell a consumer they can cancel any signed contract or purchase - including an in-store purchase, an online order, or a car bought at a dealership - within three days under a general federal 'cooling-off' right** — The FTC's Cooling-Off Rule applies only to sales made away from the seller's normal place of business - at the buyer's home, a temporary venue like a hotel room, or similarly - and above $25 (at the buyer's residence) or $130 (elsewhere). Sales at the seller's regular retail location, and sales made entirely by mail, phone, or online with no other prior contact, are excluded outright. (85% fail)
- **Assume the cancellation right applies once a threshold amount is spent, regardless of where the sale happened** — The dollar threshold is tied to location, not just amount: $25 or more only covers sales at the buyer's own residence; sales at any other qualifying off-premises location (hotel room, fairground, workplace, dorm) require $130 or more to be covered. (50% fail)