What are a car buyer's rights if a car loan is denied and you have taken the car

Asked almost 6 years ago - Tucson, AZ

if a car dealership gives you a car without having a buyer for the loan, will you be penalized for giving the car back?

Additional information

I PUT A DEPOSIT ON A CAR AND TOOK IT OFF THE LOT UNDERSTANDING THAT THE CHECK WOULD NOT BE CASHED UNTIL WE WOULD CLOSE ON WEDNESDAY. I DID NOT GET APPROVED. BY SATURDAY, I HAD BEEN IN CONTACT WITH THAT DEALERSHIP EVERY DAY. TOLD THEM I WAS BRINGING THE CAR BACK. THEY SAID TO COME IN ON MONDAY AND SIGN PAPERS FOR MORE THAN I WANTED TO PAY. THE CAR WAS WRECKED ON SATURDAY. THE DEALERSHIP WAS CALLED 4 TIMES THAT DAY ABOUT THE COLLISION. NO ONE CALLED US UNTIL MONDAY SAYING THEY DID NOT GET THE MESSAGES. THE WANTED ME TO LIE TO THE FINANCE COMPANY ABOUT HOW MUCH I MADE AND THAT I HAD COMPLETED THE APPLICATION FOR A LOAN ON LINE WHICH I DID NOT. THEY DID. NOW THEY ARE SAYING I AM RESPONSIBLE FOR FIXING THE CAR AND IT IS MY RESPONDSIBILITY TO PAY FOR TOWING AND STORAGE. THE TOWING COMPANY TELLS ME I CANT REMOVE THE CAR BECAUSE I DON'T HAVE TITLE OR REGISTRATION TO THE CAR. MY INSURANCE ISN'T PAYING FOR THE DAMAGES. NOW WHERE DO I GO ? THANKS FOR YOUR HELP.

Attorney answers (1)

  1. Christopher Swerling McDonagh

    Contributor Level 9

    Answered . DISCLAIMER- THIS IS NOT INTENDED TO AND DOES NOT CONSTITUTE LEGAL ADVICE AND DOES NOT ESTABLISH AN ATTORNEY-CLIENT RELATIONSHIP. CONSULT QUALIFIED LEGAL COUNSEL IN YOUR CITY OR STATE FOR LEGAL ADVICE.

    I can’t give you a definitive answer without knowing all the relevant facts. Depending on the facts, there might or might not be a problem with returning the car and terminating your contract.

    First, you need to review any contracts you signed -- purchase contract for the car, loan agreement and/or promissory note, etc. -- to see what they say your rights and obligations are. They might state that you have a right to return the car and cancel the contract(s).

    Even if you signed a contract that is binding and does not explicitly state that you have a right to cancel or return the car, it's possible you might still have the right under Arizona law (assuming you bought the car in Arizona) to rescind (i.e., undo) the contract and return the car without penalty if you entered the contract in reliance on a misprepresentation by the seller, subject to an agreed upon condition (e.g., financing), or based on a mistake of fact basic to the transaction. For example, if you agreed to buy the car only the stated condition that you would receive financing or the dealer told you that you had been approved for financing, and now the dealer is telling you there is no financing, then you might have a right to rescind the contract and return the car without penalty.

    I can only say this is a possibility, and I would have to first find out all the relevant facts and review any relevant documents to be able to give you a definitive answer. Feel free to contact me if you need more assistance with this.

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