Consumer rights expert Martyn James explains what you need to know if you change your mind about a purchase
Whenever I write about consumer issues for the Mirror, it’s often off the back of my own experiences… and errors.
Nobody wants a perfect person telling them what to do right?! And I’m far from perfect. I recently felt a sense of dread as a mystery parcel arrived at my door.
It turns out I’d decided to order a new electric toothbrush online after a few glasses of wine. I’d also repeatedly clicked the order button.
So five expensive electric toothbrushes turned up out of the blue. I have no memory of placing this order – and I have a perfectly good electric toothbrush too.
If you’re like me and are occasionally filled with shopping regrets, then fear not! You can change your mind if you’re quick. That’s all thanks to the wonder of “cooling off periods”. Here’s my guide.
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What is a cooling off period?
A cooling off period is a short period of time where you can change your mind about goods or services you have purchased.
As a general rule, cooling off periods give you 14 days to change your mind. However, don’t assume everything has a cooling off period… There are a number of exceptions – and terms and conditions apply.
Shopping and cooling off periods
Online shopping is designed to get us to click to commit before we’ve had time to think if the thing we are buying is something we want or need.
But if you do get carried away in the sales or make a snap decision that you later regret, you could cancel the order if you are quick.
The Consumer Contract Regulations gives you the right to cancel contracts when you buy online within the first 14 days of purchase. This includes virtual goods like music and software, as long as you haven’t downloaded it.
The Consumer Contract Regulations also covers many other things in relation to contracts that you enter in to with a seller of goods or services. For example, the law sets out when a contract is fair and what you should be told when you take one out.
The law applies to ‘off-premises and distance contracts’. This means that goods you buy online are covered by the 14-day cooling off period, but not those you buy on the high street.
The law also applies to contracts you don’t sign at the location of the business too. So if you sign up to get a new kitchen with a salesperson visiting your home, then you’re covered too. You may be asked to sign an exemption though if you want work to start straight away.
Perhaps inevitably, there are lots of exemptions to the law. For example, you won’t be covered by a cooling off period if you commission an item that’s made to order. This also includes things that might seem innocent at first, like getting a watch or phone engraved. Underpants are out too for hygiene reasons.
Here’s the full list of what’s exempt according to the government guide to the law:
- Gambling as covered by the Gambling Act 2005.
- Construction and sale of immovable property including building of new properties.
- Residential letting contracts.
- Package travel contracts.
- Timeshare contracts.
- Supply of consumables by tradespeople such as milkmen
- Purchases from vending machines.
- Single telecom connections (e.g. payphones and café internet connection).
Contracts which are only partly covered:
- Passenger transport contracts.
- Low value off-premises contracts (value less than £42). These are any goods or services sold away from the business premises, like someone cleaning your windows.
- Items dispensed on prescription.
There are other things that aren’t mentioned in the legislation, but can’t usually be cancelled or returned:
- Perishable goods (flowers, fruit, anything that goes off quickly).
- Items made to order.
- Items personalised.
Financial products are covered by separate rules (see below)
How some retailers try to avoid the law
To my immense frustration, many retailers make it as difficult as possible to cancel orders and return items. A worryingly large number of online retailers have no telephone phone number or email address – so how do you tell the business you want to change your mind?
Before you purchase, check the “contact us” page of a retailer before making a purchase. If you can’t get in touch with a shop, why give them your cash?
Increasingly, I’m hearing from readers who tell me about outright lies told to them by retailers about the law. One example is where businesses claim an item has already been sent and can’t be recalled.
You can find out if this is true by clicking on the tracking option for a parcel, but even if it’s been dispatched you can still cancel.
If an item has been dispatched, then you’ll have to pay the cost of the return (if there’s no free return option) if you’ve changed your mind.
But not if the goods are misrepresented, damaged or not as advertised. Alternatively, if you don’t accept a parcel, it will be returned to the shop.
What about ongoing contracts and services?
From a gym membership that seemed like a good idea in January, to a premium food delivery site, the 14 day cooling off period applies to most services.
This includes some utility contracts like broadband and mobile phone agreements. However, if you’ve “sampled the goods” then the business can make some deductions to any refunds you might be offered to reflect the fair use of the services.
Some telecommunications firms have been known to offer further discounts if you try to leave within the cooling off period.
Financial products and cooling off periods
Though financial products have their own separate rules involving cooling off periods, some are covered by the Consumer Contract Regulations. So if a financial product is sold alongside a product or service, it should also have a 14 day cooling off period. For example:
- Warranties
- Insurance products sold with things like vehicle purchases
- Point-of-sale credit agreements, where you take out credit to buy the goods or services.
However, when it comes to other financial products, the rules vary.
Bank accounts
You have 14 days to cancel a bank account if you decide you don’t want it. However, if you’ve managed to go in to the overdraft or you’ve racked up some debts with account-linked products, you’ll need to pay them off within that period.
This is something of a redundant right though, you can cancel a bank account more or less whenever you like anyway, as long as you’ve paid off any outstanding credit facilities.
Also under the switching account rules, you can expect to be transferred to a new account – regular payments and all – within seven working days. If you change your mind about an account switch, you can change your mind up to seven days before the switch is due to take place. If it’s underway, you’ll have to see it through.
Savings accounts
As with a bank account, you can cancel a standard ‘easy access’ savings account – where interest gets paid at a variable rate and has no strings attached – at any time you chose. However, you get better rates of interest if you lock your money in to a “notice account”.
Notice accounts are named because you have to agree to put your money away for a set period of time, during which you can’t withdraw it.
This might be as low as seven days or go all the way up to 180 days. Many of the best rates arise if you are happy to wave goodbye to your cash for three or even five years.
But be warned: once that money is in, it cannot be released unless there are exceptional circumstances – and even then, there will be penalties.
Mortgages
Anyone who’s applied for a mortgage over the last few decades will know that the process moves at a glacial pace. So there’s no cooling off period for mortgages, but there are numerous opportunities to pull out of the deal during the process, though you may lose costs you’ve paid out. This includes linked products like buy-to-let and equity release.
Insurance
Broadly speaking, there are two types of insurance policy:
- General insurance: these products last a year and renew at the same time. This includes most policies, including home, vehicle, travel and more.
- Life insurance/assurance: Policies designed to cover your life (or a big chunk of it) and health related insurance products.
Most general insurance policies – including the main types – will give you a 14 day cooling off period, though there are exceptions.
The big one is travel insurance. If you have an annual travel policy then you will have a 14 day cooling off period. But if you buy a single trip policy, you won’t, unless the business decides to offer you one at its own discretion.
There may be an exclusion clause with some forms of insurance – a time period during which you can’t make a claim. I’m pleased to say that these aren’t nearly as common these days as they used to be. You may also be offered a discount on premiums for agreeing to a longer “no claim” period.
When it comes to the various different types of life insurance (including: life cover, critical illness, payment protection, income protection, etc.) you have a 30 day cancellation period.
This reflects the long-term nature of these policies. However, short term policies (around six months or so) are unlikely to offer this cooling off period. The same goes for policies with a cash value or those bought from a broker at point of sale.
Credit and loans
Regulated credit products, 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 where no interest is changed, as these agreements are not currently regulated. Obviously, you’ll have to return the cash and any items bought with the credit (or find another way to pay for them.
Pensions and investments
Given that they are one of the most important – and complicated – financial products you’ll ever purchase, a pension will usually give you a cooling off period of 30 days.
This is sometimes referred to as the “opt out” period. The same goes for annuities, the financial vehicle you purchase to pay you a set amount of money 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. Far too many people stay silent because they don’t want to admit that they don’t understand how these financial agreements work.
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.
What about longer retailer return rights?
Sometimes retailers extend your shopping return rights. This is at the discretion of the shop and does not affect your statutory rights to return goods that are misrepresented or faulty.
You can find out more about your statutory rights when shopping here.
Most extended returns for non-faulty products take place over Christmas, with many retailers extending return timescales by up to 30 days. However, the rules around returns within these timeframes – either on the high street or over 14 days online – are up to the seller. This may include whether you get cash, an exchange or store credit.
- Martyn James is a leading consumer rights campaigner, TV and radio broadcaster and journalist
