Refunds aren't exactly a right

Most people probably know that North Carolina law allows buyers to get a refund on a product or service if they change their mind within three to seven days of their purchase.

But not everyone realizes that the law doesn't apply to all purchases.

Kenneth Holmes of Raleigh found that out the hard way when he went shopping for a car in February.

He found one he liked on a Saturday and left a $500 deposit to secure the transport of the car to the Toyota of Henderson dealership. He planned to buy the car once it arrived.

But by Monday morning, Holmes had changed his mind after finding a newer model.

He canceled his original order and expected a full refund.

Instead, he was told the deposit was nonrefundable, a policy that was clearly written in a couple of places on the contract he had signed. Holmes knew the contract but still thought he had the legal right to cancel.

"I thought I had a three-day grace period to change my mind," Holmes said.

But North Carolina's right-to-cancel law applies to only a few situations.

Consumers aren't entirely to blame for not knowing the law inside and out, said Beverly Baskin, president of the Better Business Bureau of Eastern North Carolina.

Many retailers have made it a common practice to give refunds, even though they are under no obligation to do so.

"We have been spoiled," Baskin said. "We are so used to taking something back and saying, 'I don't want this,' and getting a refund. But truly the store is under no obligation to do an exchange or give a refund unless the product is misrepresented or not working properly."

There are actually only a handful of business deals that the state gives consumers the right to back out of within three to seven days after the purchase agreement.

They include:

* Door-to-door sales of items bought on credit;

* Timeshares purchased from a developer or salesperson;

* Loans secured by the borrower's principal residence, such as a home equity line of credit;

* Undeveloped land purchased under certain conditions.

The right to cancel law does not apply to most other products and services including:

* Clothes, homes, mobile homes, automobiles;

* Gym memberships;

* Dance classes;

* Funeral arrangements;

* Sales worth less than $25.

Most businesses have been willing to offer refunds and exchanges as a service to customers. But it's possible that as the economy continues to slow and sales drop, some companies may be less forgiving of people with buyers' remorse. Baskin says that shoppers should routinely ask businesses about their cancellation and refund policies before they close a deal.

The $500 lesson has certainly been an eye-opener for Holmes, who says he will ask a lot of questions the next time he makes a major purchase.

"I won't assume anything," he said.