Why you should make sure you've got a right to change your mind
Cooling off periods are great if you get buyer’s remorse, says Martyn James, but beware of some caveats
Speaking as someone who has ordered a thing or two online after a few sherries, then comes to regret it the next day, I’m a big fan of cooling off periods.
A cooling off period is a short window of opportunity where you can change your mind about goods or services you have just purchased. As a general rule, cooling off periods give you 14 days to change your mind. But buyer beware! There are a number of exceptions – and terms and conditions apply.
Shopping and cooling off periods
There’s a nifty law called the Consumer Contract Regulations that gives us the right to cancel contracts when we buy things online within the first 14 days of purchase. This includes ‘virtual’ goods, like music or computer games and software, (as long as you haven’t downloaded them). You may have to pay to return the goods though.
The law also applies to ‘off-premises and distance contracts’. These are contracts you don’t sign at the location of a business. This could be when a salesperson signs you up for a new sofa when visiting your home, or you agree to a broadband contract on the phone.
However, if you purchase something in person, the cooling off period does not apply. This includes anything you buy from a retailer on the high street, or a broadband contract you sign up to at the supplier’s shop.
Not everything you can buy online comes with a cooling off period. For example, if you’ve had something made to order or personalised you can’t change your mind. So think twice before you get an item engraved! There are a number of other exceptions under the law too. Most types of contracts for construction work, travel and holidays or renting a home won’t give a cooling off period. You should be told if that’s the case though so you can make an informed decision.
Sometimes the seller may give you the option of waiving the cooling off period as a means to speed things up, like the conveyancing for a house sale. This is allowed, but you must not be pressured in to doing so.
Ongoing contracts, from gym memberships to subscription services are usually covered by the 14-day cooling off period if you buy online or remotely. However, if you’ve begun using the goods then the business can make some deductions to any refunds you might be offered to reflect the fair use of the services.
Financial products and cooling off periods
Financial products have their own separate regulations involving cooling off periods, however, some things are covered by the Consumer Contract Regulations too.
Regulated credit products, like loans, finance agreements – anything that charges interest or a fee for the credit – are covered by a 14-day cooling off period. The exception is buy now, pay later credit deals that don’t charge interest.
Most general insurance policies will give you a 14-day cooling off period, though there are exceptions here too! If you have an annual travel policy then you will have the standard cancellation rights. But if you buy a single trip policy, you won’t, unless the business decides to offer you one at its own discretion.
There is no cooling-off period for mortgages, though you’ll have countless opportunities to pull out during the process.
Pensions are one of the most important financial products you’ll ever purchase, so you get a longer cooling off period of 30 days. This is sometimes referred to as the ‘opt out’ period. The same goes for annuities, which is what you purchase with your pension pot to pay you a regular income when your pension matures. Make sure you fully understand the rules and what you’re getting in to when buying or changing a pension or purchasing an annuity though.
Regulated investments generally have cooling off periods of between 14 and 30 days, depending on the product. Bear in mind unregulated investments like commodities and cryptocurrency are not required to give you cooling off periods.
Martyn James is a leading consumer rights campaigner, TV and radio broadcaster and journalist. Visit martynjamesexpert.co.uk