In Texas, the three-day right to cancel (cooling-off period) generally applies to consumer transactions resulting from personal solicitation at a location other than the merchant’s place of business—commonly known as “home solicitation sales”—as well as certain contracts for the sale of manufactured homes and some home improvement contracts. Tex. Bus. & Com. Code §§ 601.001 et seq. However, this right does not extend to transactions such as in-store purchases, automobile sales at dealerships, insurance sales, farm equipment purchases, and several categories of real property transactions, among other statutory exclusions.
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Contracts Covered by the Three-Day Right to Cancel in Texas
You generally have the right to cancel a contract within three business days if:
- You signed the contract somewhere other than the seller’s regular place of business.
This usually means sales that happen at your home, at a temporary location (like a hotel or fair), or anywhere that isn’t the seller’s normal store or office. These are often called “home solicitation sales.” - The contract is for goods or services worth more than $25, or real estate worth more than $100.
- You buy a manufactured (mobile) home from a licensed dealer.
- You sign a contract for home improvements on your primary residence (your homestead).
(There are exceptions for emergency repairs—see below.)
In these situations, you can cancel the contract for any reason within three business days after signing. The seller must give you written notice of this right.
Contracts NOT Covered by the Three-Day Right to Cancel
You do not have the three-day cancellation right for:
- Purchases made at the seller’s regular business location.
If you buy something in a store, car dealership, or showroom, you usually cannot cancel just because you changed your mind. - Car purchases at dealerships.
There is no automatic three-day right to cancel for buying a car at a dealership. - Insurance policies.
- Farm equipment purchases.
- Purchases made using a preexisting store credit or charge account.
- Certain real estate transactions, such as those handled by a licensed attorney or real estate broker, or when the property owner negotiates with you somewhere other than your home.
- Home improvement contracts for emergency repairs that are needed right away for health or safety reasons, if you sign a written acknowledgment.
Key Points
- The three-day right to cancel is meant to protect you from high-pressure sales tactics when you’re away from the seller’s usual place of business.
- It does not apply to most everyday purchases, car sales at dealerships, or most real estate deals.
- If you’re unsure whether your contract qualifies, check if you were given a written notice about your right to cancel. If not, you may want to ask the seller or consult a legal professional.
If you have questions about a specific contract, consult a qualified Texas attorney for advice about your specific situation.
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