Am I able to receive a full refund or liable for a cancellation fee if a Finance Co opts out of a contract with a car dealership
3 attorney answers
This certainly sounds like a scam many small dealerships are doing this. Thankfully, you reached out for help. Consult with an attorney before you do anything especially if you are considering going back to dealership.
This response will not create an attorney-client relationship between you and The Law Office of Anthony Munoz, and is not intended to serve as a legal advice in your specific circumstances. This response is a legal opinion based solely on facts represented and you should not rely on this legal opinion as a legal advice. You still need to consult an attorney directly to fully protect your legal rights.
In dealing with these issues in CA for many years I'm fairly confident your contract calls for a full refund. Still someone should look at the contract to see. As to the other facts you raise, it seems like something is rotten in Denmark, so be wary...
This sounds like a classic "yo-yo" scam. (Google it.) The dealer sells you a car on certain terms, but the sale is conditional on financing. Then the dealer calls you back to the dealership, claims that the financing fell through, and asks you to sign paperwork for a much less attractive deal.
Whether the dealer has the right to "undo" the original contract depends on its terms. It would be best to have a lawyer review the sales documents and give you a legal opinion as to whether the dealer is stuck with financing the vehicle itself, or whether the sale can be canceled.
If the sale can be cancelled, the dealer must restore you to your pre-sale status. That means returning any trade in and any down payment. Do not give the car back until you have these things in your hand. If the dealer says it will take a few days to process the return of your down payment, you should keep the car until the process is done.
If you want to be especially careful, don't take the car to the dealership when you go back to sort this out; you never know who might have an extra set of keys. And do not accept a check for your down payment; the dealer can stop payment on a check, but with cash in hand you know you've gotten your money back.