3 Day Right of Rescission Form

What is right of rescission and what makes it so important for contractors who are working for U.S. homeowners? Learn the answer and grab your sample form right here.

What You Should Know Before Using Our Three Day Right of Rescission Form

Under U.S. federal law, contractors doing home improvements for homeowners must give the owners 3 business days to back out of the deal (what we call a 3 day right to rescind or 3 day right to cancel)... if the conditions below are met:

1. The cost of home improvement is $25 or more or is to be financed by a creditor (the contractor or a lender)

2. The owner (directly or indirectly) grants the creditor a security interest in the home, e.g. Mechanic's Lien

3. The home to be worked on is the owner's principal dwelling (main home)

If the above sounds just like you, then you will need to give the homeowner a written notice of right to cancel (also known as a notice of right to rescind or simply notice of rescission). Once again, there are strict rules to follow when you are dishing out these forms to your homeowners:

1. Two copies have to be given to each homeowner - The first copy is for them to keep, the second is for them to return in case they have the jitters and want to back out of the deal (ouch).

2. The notice has to be in bold and the font size has to be at least 10 points.

*Make sure this 3 day right of rescission form complies with your local real estate laws before using it. If you have any doubts, you can ask a real estate lawyer online.

Notice of Right to Cancel

Date: _______________

You may CANCEL this transaction, without any penalty or obligation, within THREE BUSINESS DAYS from the above date.

If you cancel, any property traded-in, any payments made by you under the contract or sale, and any negotiable instrument executed by you will be returned within TEN BUSINESS DAYS following receipt by the seller of your cancellation notice, and any security interest arising out of the transaction will be canceled.

If you cancel, you must make available to the seller, at your residence, in substantially as good condition as when received by you, any goods delivered to you under this contract or sale; or you may, if you wish, comply with the instructions of the seller regarding the return shipment of the goods at the seller’s expense and risk.

If you do make the goods available to the seller and the seller does not pick them up within 20 days of the date of your notice of cancellation, you may retain or dispose of the goods without any further obligation.

To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice or telegram, to:

_________________________ (Name of Seller) at

(Address of Seller’s Place of Business)

NO LATER THAN MIDNIGHT OF _______________ (Date)


Buyer's Signature: _________________________

Date: _______________

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