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In California, can a car dealer rescind a contract after 3 weeks have passed. They want me to pay a higher interest rate.

Oakland, CA |

My credit score is fair. I was assured there would be no problems with financing. 3 weeks after I got the car the dealer asked me to come down and sign a new contract with a higher interest rate. When I told them I could not afford the higher payment, they said they would contact me in a couple of days. At this point they have not notified me in writing, that they want to cancel the current contract. Since it has been more than 10 days since I signed the deal, does the dealer have to accept the original contract.

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Attorney answers 2


The answer will likely be determined by the language of the agreement. Oftentimes, particularly with used cars, the dealership allows you to drive the car off the lot subject to approval by financing. If this is the deal you have, then you will have to return the car or agree to the higher interest rate. However, if there is nothing conditional in the agreement, the dealer cannot unilaterally change the terms of the deal. You really need to have someone look at your agreement to be able to advise you properly.



My contract clearly states that the seller has to notify me with in 10 days from the date of the contract if the seller elects to cancel the contract. So far they have not done so. I've had the new car for 3 weeks already. I live in California.


You should carefully read (front and back) of each document that you signed during the deal. The contract will determine what the dealership can or cannot do under the contract (with few public policy exceptions). There is also likely an arbitration agreement that you signed. If you and the dealership cannot come to an agreement, and they insist on rescinding the contract, your case will likely be resolved in a binding arbitration. Best of luck.

I am licensed in California, therefore, my answers are based on general prinicpals of law or California law, which may not be applicable in your jurisdiction. Answers posted to Avvo are for general information only. Do not conclusively rely on any information posted online when deciding what to do about your case. Every case depends is fact dependent, and responses are limited to and is based on the information you posted. No attorney-client relationship shall be created through the use reading of this response on Avvo. You should never delay seeking legal advice, disregard legal advice, or commence or discontinue any legal action because of information in this response.

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