Cooling-off period

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This fact sheet is general information only. If you need a lawyer, try LawMatch™ a free service that matches you with a lawyer who meets your legal needs and preferences.

What's a cooling-off period?

Most purchasers have the right to get out of the contract in certain circumstances - this is called a "cooling-off period" (check the law in your State or Territory). Make sure you know whether you have this right at the time ANY type of contract is signed and how you can assert this right if you want to.

The rules about cooling-off periods vary depending on the State or Territory law. In general, they only apply when:

• You notify the seller in writing within a defined number of clear business days after the contract is signed;
• there is a private sale, not an auction;
• it is a domestic property, it does not apply to a commercial property or a farm.

Note: The cooling-off period may not apply if you consulted a lawyer before signing the contract.

What's "clear business days"?

Don't worry what this means - just remember that the days begin at midnight of the day you signed the Contract of Sale or Contract Note, and includes the next specified number of days, but does not include a Saturday, Sunday or public holiday. Remember, it runs from the time you sign the contract, not from when the seller signs!

How do I cancel the contract?

Get legal advice as soon as you wish to cancel the contract. This may involve writing a letter to the seller or the seller's agent (if that was who you dealt with). The letter should say that you intend to exercise your right to cancel the contract within the cooling off period.

Clearly name the seller and the property. Include a photocopy of the receipt you received for the deposit, and sign and date the letter.

It's a good idea to personally hand the letter to the seller or the agent (or left at the agency office), and obtain a "receipt" that is dated and signed by the person who receives it.

Again, get legal advice immediately to ensure you have communicated your intention to exercise your right to cancel the contract within the cooling off period.

Will I get my deposit back?

You may not be entitled to a full refund. Get legal advice about any money (or percentage of the purchase price) the seller is permitted to keep.