Before you sign a contract to purchase your new home, you must be sure you understand clearly your cooling off rights. Do you have the right to cool off? When and how can you exercise that right? What happens if you waive your cooling off rights? There are all vital questions that your conveyancer can answer for you.

The buyer's cooling off rights are linked to the document known as the Form 1 or "Statement under section 7". The Form 1 is a formal statement by the vendor about certain details relating to the property. It is required under the Land and Business (Sale and Conveyancing) Act 1994.

The information set out in the Form 1 must be complete and accurate at the later of -

• the time that the Form 1 is given to the buyer; and
• at the time the buyer enters into the contract if the Form 1 was received prior.

Please refer to Form 1 for details of this obligation and the consequences for failure to comply with this obligation.

Your right to rescind the contract - usually referred to as "the right to cool off" - is linked to receiving a complete and accurate Form 1. This right is provided by the Act and is completely independent of any conditions in the contract.

Be aware that not all buyers have the right to cool off. The right does not exist if:

• you have waived your right by getting independent legal advice and have a certificate from the legal practitioner to that effect;
• the sale occurs at the auction of the property;
• the sale occurs following the auction and you were a bidder at the auction;
• you are buying it as a company;
• in certain circumstances where the sale involves a tender or option to purchase; or
• the purchase of the property is part of the purchase of a business.

You should be very careful about waiving your right to cool off if you have not received all information that would be included in the Form 1.

If the property is being auctioned, the Form 1 must be available for inspection at the agent's office at least three business days prior to the auction. It must also be available at the auction for at least 30 minutes before the auction commences.

A buyer wishing to cool off must do so in writing within two clear business days from the later of -

• receiving a complete and accurate Form 1; and
• entering into the contract.

You must notify the seller precisely as set out in the Form 1. If you have signed the contract but not received a Form 1, your conveyancer can explain the process for cooling off.

The right to cool off can only be brought to an end by settlement or the service of a complete and accurate Form 1; a incomplete or inaccurate Form 1 does not end the right to cool off. Settlement does not necessarily extinguish all legal rights (including the right to rescind the contract) where a complete and accurate Form 1 has not been received.

As a buyer, it is critical you understand your rights in relation to cooling off. Your conveyancer is the person to talk to about signing the contract; the contents of the Form 1; and the right to cool off. You should contact your conveyancer as soon as possible after receiving the Form 1 to get independent, professional advice.