State Law Guide
Many F&I products allow cancellation for a pro-rata refund, but the contract, product type, timing, claims, and state law all matter.
Texas Extended Warranty Cancellation Guide
Under Texas Occupations Code Chapter 1304, Texas gives you the right to cancel and receive refunds on F&I products. You have a 30 days free look period for full refunds. Dealers who fail to comply face A penalty of 10% of the amount outstanding for each month a service-contract refund or credit remains unpaid after the 45th day following the provider's receipt of the cancellation notice (Tex. Occ. Code § 1304.1581(e)).
Quick Answer
Cancellation rights in Texas depend on the product and contract. Upload yours to see which add-ons appear cancellable. During the first 30 days, you receive a full refund (minus up to $50 fee). Refunds must be issued within 45 days. You can sue in Small Claims Court for up to $20,000.
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Key Texas Provisions
| Provision | Requirement | Your Right |
|---|---|---|
| Free Look Period | 30 days (Occ. Code § 1304.1581(b)) | Full refund before the 31st day, less claims paid; no cancellation fee may be imposed in that window |
| Cancellation Fee | Max $50 from day 31 (Occ. Code § 1304.1581(c)(2)) | On or after the 31st day, the provider may charge only a reasonable cancellation fee of no more than $50 |
| Pro-Rata Refund | Required from day 31 (Occ. Code § 1304.1581(c)(1)) | Refund of the prorated purchase price for the remaining term, based on mileage, time or another measure disclosed in the contract, less claims paid |
| Refund Deadline | Before the 46th day (Occ. Code § 1304.1581(e)) | The refund or credit is due before the 46th day after the provider receives notice of cancellation |
| Late Penalty | 10% per month (Occ. Code § 1304.1581(e)) | The provider owes 10% of the outstanding amount for each month it stays unpaid, on top of the refund |
| GAP Waiver Refunds | Fin. Code § 354.007 (installment contracts that require insurance) | Cancel within 30 days of the contract, with no total loss or theft, for a refund of the entire GAP fee; after early payoff, the holder must refund or credit an appropriate amount within 60 days or instruct the administrator within 30 days (§ 354.007(c), (e), (e-1)) |
Free Look Period
30 days (Occ. Code § 1304.1581(b))Cancellation Fee
Max $50 from day 31 (Occ. Code § 1304.1581(c)(2))Pro-Rata Refund
Required from day 31 (Occ. Code § 1304.1581(c)(1))Refund Deadline
Before the 46th day (Occ. Code § 1304.1581(e))Late Penalty
10% per month (Occ. Code § 1304.1581(e))GAP Waiver Refunds
Fin. Code § 354.007 (installment contracts that require insurance)What Texas Law Requires
Your Cancellation Rights
Under Texas Occupations Code Chapter 1304, some F&I products sold in Texas may be cancellable or refundable, subject to their contract terms. During the free look period (30 days), you receive a full refund. After this period, you're still entitled to a pro-rata refund based on unused time or mileage.
Timeline
Once you submit your request, the dealer or administrator has 45 days to respond. Failure to comply may result in A penalty of 10% of the amount outstanding for each month a service-contract refund or credit remains unpaid after the 45th day following the provider's receipt of the cancellation notice (Tex. Occ. Code § 1304.1581(e)).
Your contract may include cancellation rights that are easy to overlook. We identify the products, check the applicable terms and rules, and estimate what may be refundable.
A formal demand letter citing your state's exact statutes is harder to ignore than a generic email.
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Frequently Asked Questions
Can I cancel my extended warranty in Texas?
Yes. A Texas service contract must let you cancel at any time (Tex. Occ. Code § 1304.1581(a)). Cancel before the 31st day after purchase and you get the full price back, less claims paid, with no cancellation fee; after that you get a prorated refund less claims paid and a fee of no more than $50 (§ 1304.1581(b), (c)).
What is the maximum cancellation fee in Texas?
No fee may be charged if you cancel a service contract before the 31st day after purchase; from the 31st day the provider may charge a reasonable cancellation fee of no more than $50, however much you paid (Tex. Occ. Code § 1304.1581(b)(2), (c)(2)). GAP waivers follow Finance Code chapter 354 instead.
What if my Texas dealer doesn't refund on time?
If the provider does not pay your service-contract refund or credit before the 46th day after it receives your cancellation notice, it owes you a penalty of 10% of the outstanding amount for each month it stays unpaid, on top of the refund (Tex. Occ. Code § 1304.1581(e)).
Where do I file a complaint against a Texas dealer?
File service-contract complaints with the Texas Department of Licensing and Regulation, which regulates service contract providers under Occupations Code chapter 1304, and deceptive-practice complaints with the Texas Attorney General Consumer Protection Division. GAP waiver complaints go to the Texas Office of Consumer Credit Commissioner.
Texas Regulatory Contacts
If you need to file a complaint or seek assistance, contact these official agencies:
Contact information is provided for reference. Verify current details on official agency websites.
Compare Other States
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Optional letter only if you act · Texas Occupations Code Chapter 1304