MHIC Door-to-Door Sales Act — Questions and Answers
Question 1: Under Maryland's Door-to-Door Sales Act (Home Solicitation Sales Act), how many business days does a homeowner have to cancel a contract signed at their residence?
- 1 business day
- 3 business days (Correct answer)
- 5 business days
- 7 business days
Correct answer: 3 business days
Maryland's Door-to-Door Sales Act gives consumers 3 business days to cancel any qualifying contract signed at their home without penalty. This 'cooling-off period' is designed to protect homeowners from high-pressure in-home sales tactics.
Question 2: The Maryland Door-to-Door Sales Act applies to home solicitation contracts of what minimum dollar amount?
- $10
- $25 (Correct answer)
- $100
- $500
Correct answer: $25
Maryland's Home Solicitation Sales Act applies to consumer transactions of $25 or more that are solicited and signed at the buyer's home. The low threshold is intentional — even modest in-home purchases trigger the cancellation right.
Question 3: Which of the following sales transactions is subject to Maryland's Door-to-Door Sales Act cancellation requirements?
- A $5,000 roofing contract signed at the contractor's office
- A $500 painting contract signed at the homeowner's kitchen table (Correct answer)
- A verbal agreement at the homeowner's home for $20 in minor repairs
- A $10,000 renovation contract signed via email
Correct answer: A $500 painting contract signed at the homeowner's kitchen table
The Door-to-Door Sales Act applies to contracts of $25 or more that are solicited and signed at the buyer's home. A $500 painting contract signed at the homeowner's residence meets both criteria — the amount threshold and the in-home location.
Question 4: When a Maryland contractor completes a home solicitation sale, they are REQUIRED to provide the buyer with:
- A copy of the signed contract and a written notice of the right to cancel (Correct answer)
- A performance bond equal to 10% of the contract price
- Three references from comparable completed projects
- A copy of their MHIC license certificate
Correct answer: A copy of the signed contract and a written notice of the right to cancel
Maryland law requires that in any door-to-door sale, the contractor provide the customer with both a copy of the contract and a separate written notice of their right to cancel within 3 business days. Without these documents, the buyer's cancellation window remains open indefinitely.
Question 5: A homeowner cancels a $3,000 home improvement contract within the 3-day cooling-off period. The contractor had already purchased $500 in materials for the job. Under Maryland law, what is the contractor entitled to?
- The full $3,000 because materials were purchased in reliance on the contract
- $500 for materials plus a restocking fee
- Nothing — the contractor must return any deposit and cannot charge for materials not yet installed (Correct answer)
- $500 only if the materials cannot be returned to the supplier
Correct answer: Nothing — the contractor must return any deposit and cannot charge for materials not yet installed
Under the Door-to-Door Sales Act, when a buyer cancels within the 3-day period, the contractor must return all deposits and cannot retain any funds or charge for materials purchased but not yet installed. The cancellation right is absolute during the cooling-off period.
Question 6: A contractor fails to include the required cancellation notice in a home solicitation sales contract in Maryland. What is the legal consequence?
- The contractor faces a $50 fine per occurrence
- The buyer's right to cancel is extended until proper notice is provided (Correct answer)
- The contract is automatically void and unenforceable from the start
- The MHIC may suspend the contractor's license for 30 days
Correct answer: The buyer's right to cancel is extended until proper notice is provided
If a contractor fails to include the required written notice of cancellation rights, the buyer's right to cancel is extended — they may cancel at any time until proper notice is given, even months or years later. This strong remedy incentivizes contractors to comply.
MHIC Door-to-Door Sales Act
Under Maryland's Door-to-Door Sales Act (Home Solicitation Sales Act), how many business days does a homeowner have to cancel a contract signed at their residence?