Cancellation

Can I cancel after I’ve signed the contract?

You have a number of days after you received a copy of the disclosure document to decide if you want to cancel (see below). You can cancel at any time if you haven’t received a copy of the disclosure document yet.

After you receive the disclosure document

After you receive all of the important information including notification of your right to cancel and a copy of the contract, you have a short cooling-off period – during which you can cancel in writing.

The length of this cooling-off period will depend on the way in which the information was given to you. If the paperwork was:

• handed to you directly – you have three working days
• sent to you electronically (email, fax etc) – you have five working days
• mailed to you – you have seven working days from the date it was posted.

Saturdays, Sundays and public holidays are not working days.

If the creditor hasn’t provided disclosure correctly

If you haven’t received all of the key information (including your right to cancel) and a copy of the contract, or if some of that information is incorrect, then you may cancel the credit contract in writing at any time (but only if you haven’t received the correct information yet).

What about the goods or services I bought on credit?

• If you have taken the goods home or already received the service, then you will have to pay the cash price of the goods or services. You have 15 working days to pay from when you tell the creditor you are cancelling.
• If you have taken the goods home, but you haven’t received a statement about your right to cancel then you can cancel the credit and return the goods. You may have to pay for any damage to the goods.
• If you don’t have the goods or you haven’t received the service, you can cancel the credit contract and you won’t have to pay for the goods or service.
• You may have to pay cancellation fees, but these should be reasonable. You may also have to pay interest for the time that you had the credit.

What about the money I borrowed (my loan)?

After you cancel the contract, you have 15 working days to return the money. You may have to pay concellation fees, but these should be reasonable. You may also have to pay interest for the time that you had the money.

How do I cancel my credit contract?

You must cancel the credit contract in writing. You need to make sure the creditor receives your cancellation on time and that you have proof it was sent. The best way to do this is by registered mail.
 

Example letter:
On ________ [date] I signed a contract for credit with your company. The contract number is ___________. This is notice of my cancellation of this contract.

I am exercising my right to cancel this contract under the Credit Contracts and Consumer Finance Act 2003. I now have 15 working days to _________________
[return the money, or the goods - depending on your circumstances].

Write to the manager and include the date that you are writing. Include any reference numbers that the creditor has given you and sign your name at the bottom of the letter.

What if I got a loan to pay for goods I bought from a door to door salesperson?

If you bought goods from a door-to-door salesperson, the Door to Door Sales Act may apply and this gives you a longer seven-day right of cancellation.

See here for more information if you have bought from a door to door salesperson. 

You can write to the trader to say that you are cancelling the agreement. The trader must return any money you have paid and collect the goods from you.