The 3 Day Cooling Off Period

We recently had a salesman come to our home (invited – they contacted me by telephone) to educate us on the benefits of a dual energy furnace.  I won’t go into the boring details of dual energy, but the experience with the salesman was quite illuminating in itself.

He was friendly and knowledgeable (at first) and took us step by step through exactly what is dual energy and how much money we would save by converting to this system.  We currently pay $3,300/year with our gas furnace and an additional $225/month in electricity costs.   The cost savings appeared tremendous and the salesman repeatedly used the phrase, “no brainer”.

As a past sales person and knowing that Mr. X was paying attention to the details on this one, I was actually more interested in the company’s sales strategy.

There were several independent news articles proclaiming the benefits of dual energy (credibility), dozens of copies of past client contracts showing similar contract prices in our neighborhood (more credibility), and much scary math about how not converting to dual energy could cost us over $50,000 over the next 10 years (our fear).  He even had a handy form that would allow us to finance the $11,000 over 5 years at 8.39% = $230/month (convenience).

And then lots more use of the term, “no brainer”.

I knew we would not sign the contract on the spot because we have a rule that we never do that.  No exceptions.  If it is a good deal today, it will be a good deal tomorrow.  I have experienced the pain of, “buyers remorse” too many times to ever risk that emotional pain and regret ever again.

Which brings me to the part where when the salesman realized we were not going to sign on the dotted line, he let us know that, “he was not going to call us back because if we couldn’t see the value in the offer today, we never would”. He then went on to add, “You know the cost of this system is going up 20% next week, who wants to spend an extra $2,000?!”

Um, excuse me? (oh yes, we with little brains..)

My observations on the sales pitch:

• Continuous use of the term no brainer implies we have no brain if we do not sign.
• No one can predict the cost of gas or electricity over the next 10 years.  If they could, they would not be a door to door salesman.
• All things being equal, we could theoretically save $30,000 over the next 10 years in energy costs w/dual energy. I am not sure why the sales company believes they are entitled to $11,000+ of these savings.  In the end, it is all my money, and I am only willing to pay a fair price for furnace installation (and not: 30% of 10 year savings)
• I do not believe the price of the installation will increase by 20% in the next week
• I do not believe that financing the installation at 8.75% for five years is a no brainer because my monthly payments would be equal to my energy savings (I take borrowing and interest costs quite seriously)
• By pressuring us to sign the contract immediately, it only alerted me to the fact that there is probably another company offering the same service at a fraction of the price

We did not sign the contract.

But what if we did?

…and we woke up with the familiar feelings of regret and wishing we’d taken a few days to think about it and maybe get a second estimate.

The point of this post is to let you know that in the USA there is a 3 day cooling off period in which you are permitted to cancel any contract sold to you outside of the company’s regular place of business (as in: your home).  Many sales representatives will not tell you about this law (even though it’s been around since 1972) because it was designed to protect consumers from aggressive and manipulative sales tactics.

If you are in the U.S., you can read all about it here:  http://www.ftc.gov/bcp/edu/pubs/consumer/products/pro03.shtm

If you are in Canada (and in Canada it is actually 10 days – because we are so friendly and socialist!), you can read about it here:  http://www.cba.org/bc/public_media/credit/255.aspx

One of the pillars of personal responsibility with money is protecting your assets.  Please do not let pushy and unethical sales people into your home and manipulate you into signing agreements or contracts on the spot.  And if this happens, take the steps to get these documents canceled.  It’s your right as a consumer.

..and that my friends, is a no brainer.