How to Cancel a Buyer's Agreement
If you signed a purchase agreement that you now regret and wish to terminate the agreement, you need to carefully weigh your options. Although you will need to consider the possibility that the seller will file a lawsuit against you, under certain circumstances you will be able to terminate the agreement without penalty. Under other circumstances, you may be able to negotiate a settlement that will allow you to walk away far more cheaply than if you wait for a civil judgment to be rendered against you.
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Instructions
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Search for a termination clause in the text of your buyer's agreement. Many installment sales agreements contain clauses that will allow the buyer to terminate the agreement without cause as long as advance written notice is provided to the seller. There may also be a clause that provides for termination based on specific grounds.
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Look for violations of implied warranties by the seller. Implied warranties are warranties that are enforceable by law even if they are not written into the contract. They can only be disclaimed by specific reference in all capital letters in a contract. These warranties include the implied warranty of merchantability (for products), the implied warranty of fitness for a particular purpose, the implied warranty of workmanlike quality (for services), and the implied warranty of habitability (for homes). See Resources for more information.
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Research the law of your state to see if state law offers a 72-hour "cooling-off period" for the purchase of consumer goods. If it does, you may cancel the agreement without cause as long as the 72-hour deadline has not expired.
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Determine if the seller committed a serious breach of the agreement (a "material breach"). Many agreements will provide examples of material breaches. Nevertheless, a breach may be material even if it is not listed as such in the agreement. A material breach will normally entitle you to cancel the agreement immediately; a minor breach will not. There is no clear legal dividing line between minor and material breaches--courts determine this on a case-by-case basis.
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Look for a reason to rescind the agreement. The most common reason to void a buyer's agreement is fraudulent misrepresentation by the seller. In order to justify rescinding the agreement, the misrepresentation must be so serious that you probably would not have signed the agreement if the seller had told you the truth.
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Prepare a written notice to the seller stating your intention to terminate the purchase agreement and giving your reasons for doing so. Sign it, have it notarized, and deliver it to the seller. You will be obligated to make restitution to the seller (by returning any goods delivered to you that you haven't yet paid for, for example). The seller will be obligated to return any payments you have made for goods not in your possession.
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Tips & Warnings
Sellers are responsible for mitigating their damages to the extent that they can reasonably do so. This means that you will not be responsible for any damages that the seller could have reasonably avoided. If you renege on a contractual promise to purchase a car, for example, the seller is obligated to attempt to sell the car to someone else and reduce his damages accordingly.
A contract is not automatically unenforceable simply because it is not written. Although the statute of frauds (as passed by various states) requires some contracts, such as for the purchase of real estate, to be in writing, many types of oral contracts are enforceable.
References
Resources
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