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Are Car Dealership Deposits Refundable?

If you want to purchase a vehicle from a particular dealership and the dealer to hold the car for you, this will cost you a deposit. The deposit will demonstrate you are a bona fide purchaser and will honor the deal. What if you change your mind and refuse to buy the car? Are car dealership deposits refundable in such cases?

 

What does the law say?

The laws specifically stipulate that the dealership deposits may be refundable if the dealership has dishonored his contractual obligations. However, there may be certain circumstances under which the law may provide for no refund. This may happen when you have signed a document about the deposit and then back out of the arrangement for no reasonable ground.

 

What does the car dealership policy say?

The law empowers the car dealership to set its own policies on treating the deposits. However, these policies shall be consistent with the law. There may be instances when the car dealership refuses to refund the deposit citing the buyer’s contract and its policy. Whatever they cite, they should accurately indicate it in writing on any paper that you sign.

Be cautious to find the following clauses when you sign a vehicle purchase contract or a car deposit agreement:

  • The amount of the car dealership deposit;
  • Terms under which the deposit is refundable;
  • Terms under which the deposit is non-refundable;
  • Purchase price;
  • Whether the purchase price includes the deposit amount.

Consider carefully before signing. Make sure you understand and construe the contract correctly and agree with all the terms therein.

In case you sign a deposit contract stating the amount is non-refundable, you will forfeit your deposit if you cancel the purchase. In this case, not only the car dealership policy on the refund, but also your signature empowers the dealership to keep your deposit.

 

A bona fide car dealership?

You may believe that the car dealership will refund your deposit. However, this may happen only in a small number of cases. For instance, there may be force majeure cases, when you have no control over the circumstances and cannot buy the car. However, you will need to prove this and substantiate with documented facts.

By and large, if you back out of the deal, the dealership will not refund your deposit. In this case, the dealership should clearly indicate the non-refundable clause in its policies. If you do not purchase the vehicle for some other reason than the force majeure circumstances, the non-refundable clause is the safe harbor for the car dealership.

 

What if the car dealership dishonors its policy?

If the car dealership breaches its contractual obligations and dishonors its policy on the refund, you can file a claim. In this case, a skillful lawyer will take your case and seek a recourse against your car dealership. The experienced and competent attorneys at the Margarian Law firm have handled and succeeded in manifold cases in the protection of consumer rights. They will guide you throughout your claim and will check the applicability of the state laws and practices specific to your case.

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