MCOB 4.6 Cancellation of distance mortgage mediation contracts, distance home purchase mediation contracts and distance regulated sale and rent back mediation contracts

1. (1)

   A consumer has a right to cancel a distance mortgage mediation contract, a distance home purchase mediation contract or a distance regulated sale and rent back mediation contract in accordance with this section.

2. (2)

   The right to cancel must be exercised within 14 days beginning on the later of:

   1. (a)

      the day of the conclusion of the contract; or

   2. (b)

      the day on which the consumer receives the contractual terms and conditions and other information required by MCOB 4.4 and MCOB 4.5.

A consumer who has a right to cancel a distance mortgage mediation contract, a distance home purchase mediation contract or a distance regulated sale and rent back mediation contract may, without giving any reason, cancel the contract by serving notice on the firm, before the expiry of the cancellation period in MCOB 4.6.4 R either:

1. (1)

   by serving on, or otherwise sending by post, notice to the firm's last known address, addressed to the firm, its appointed representative or on any agent of the firm with authority to accept notice on the firm's behalf; or

2. (2)

   in accordance with any other practical instructions for exercising that right provided to the consumer in accordance with MCOB 4 Annex 3(5).

Where the notice of cancellation is in a durable medium and is served in accordance with MCOB 4.6.5 R, it must be treated as being served on the firm on the date it is despatched by the consumer.

By exercising a right to cancel under MCOB 4.6.4 R the consumer withdraws from the contract and the entire contract is terminated.

When a consumer exercises a right to cancel under MCOB 4.6.4 R:

1. (1)

   the firm must:

   1. (a)

      pay to the consumer without delay, and no later than 30 days after the date on which the firm received notice of cancellation from him, any sums which he has paid to or for the benefit of the firm in connection with the contract (including sums paid by the consumer to agents of the firm) except for the amount referred to in (b);

   2. (b)

      subject to (c), the firm is permitted to require the consumer to pay for the services it has actually provided in connection with the contract; the amount payable, however, must be in accordance with the sums which the consumer agreed to pay and must not:

      1. (i)

         exceed an amount which is in proportion to the extent of the service already provided to the consumer by the firm; and

      2. (ii)

         be such that it could be construed as a penalty;

   3. (c)

      sub-paragraph (b) applies only if:

      1. (i)

         where performance of the contract has commenced before expiry of the cancellation period, this was requested by the consumer; and

      2. (ii)

         the firm can demonstrate that the consumer was provided with details of the amount which he may be required to pay if exercising his right to cancel in accordance with MCOB 4 Annex 3(5).

2. (2)

   The firm is entitled to receive without delay, and no later than 30 days after the date on which the consumer posted or otherwise sent notice of cancellation to the firm any property that became the consumer's under the contract and any sums payable to the firm under (1)(b).

Where notice of cancellation has been served on a firm (or its appointed representative or agent), the firm must make and retain a record (which includes a copy of any receipt of notice issued to the consumer and the consumer's original notice instructions) for three years from the date when the firm first became aware that notice of cancellation had been served.