New car deposit refundable in MA? Nothing signed

[hydrazine]

What is the name of your state (only U.S. law)? Massachusetts


I found a leftover 2009 Honda at a Honda dealer on cars.com and filled out the form to get info on it. The dealer (who is 3 hours away but in my state) called me and we talked about the details. I said I will email him an offer. After some back and forth we agreed to a price - I asked him twice to send me some sort of invoice or price sheet showing what was agreed to. He didn't do that but during the last conversation we had, he said he would get me over to the finance guy to work out the numbers, but he just needed a copy of my drivers license and a credit card number for a deposit so that he can add that to the file to send to the finance guy.

I provided the CC number and copy of my DL.

The finance guy called me back and we discussed what sort of loan terms I was looking for regarding down payment and interest rate. He gave me an estimate of 2-4% APR with just putting down $2000.

He called the following day (today) to say the best deal he could get was 8% APR with $8000 down, and that to get this deal the bank would need copies of pay stubs, tax return from last year, personal references of people I know, copies of utility bills and other items. I told him I wasn't sure if I would be willing to accept that deal and would give it some thought, and possibly competitively shop it with my credit union. He said the reason for the rate and down payment is because I have a relatively short credit history, despite having a good credit score.

I am just trying to know my rights before I decide what to do... if I decide not to take their deal, am I entitled to my deposit back? I notice they charged my card yesterday.

I have not signed anything, and the refundability of the deposit was never discussed. The impression was most definitely given, however, that this deposit was part of the down payment on the financing, not a deposit to "hold the car".

Thanks for any info.

 

[Mass_Shyster]

A verbal contract is not enforceable for the purchase of an item over $500 in Massachusetts. The dealer must return your deposit. If he refuses, you can dispute it with your credit card company. You can't tell them that you didn't authorize the charge, but you can tell them that you did not get what you had agreed to purchase (a car for $2000 down at 2-4%).

 

[hydrazine]

A verbal contract is not enforceable for the purchase of an item over $500 in Massachusetts. The dealer must return your deposit. If he refuses, you can dispute it with your credit card company. You can't tell them that you didn't authorize the charge, but you can tell them that you did not get what you had agreed to purchase (a car for $2000 down at 2-4%).

Thank you Steve.

There aren't any specific signs that the dealer is going to try to stiff me, I just wanted to know where I stand before I have the conversation. It may never happen - my credit union may take the deal and everything will be OK.

Is the deposit refundable specifically because they are unable to provide a 2-4% rate w/2k down? Having nothing in writing, I have no proof they told me this... and they never promised it 100%, they just said that was what I should be looking at on the financing.

Could they claim that they told me the rate and deposit may be higher, and that if I want to back out, they will keep the $1k deposit? Or am I entitled to the deposit back if I cancel simply because I changed my mind (regardless of what the reason for that change is)?

Thank you

 

[Mass_Shyster]

Is the deposit refundable specifically because they are unable to provide a 2-4% rate w/2k down? Having nothing in writing, I have no proof they told me this... and they never promised it 100%, they just said that was what I should be looking at on the financing.

The deposit is refundable because they have no valid reason to have your money. The deposit is "consideration" on your part to support the contract. Since the contract is not in writing, and is for an item over $500, the contract is not enforceable.

 

[hydrazine]

The deposit is refundable because they have no valid reason to have your money. The deposit is "consideration" on your part to support the contract. Since the contract is not in writing, and is for an item over $500, the contract is not enforceable.

Thank you Steve, you are an officer and a gentleman

So the law of Massachusetts is 100% on my side on this. I hope the deal with go through, it's just comforting to know my rights.

Have a great weekend.

 

[Mass_Shyster]

Thank you Steve, you are an officer and a gentleman

So the law of Massachusetts is 100% on my side on this. I hope the deal with go through, it's just comforting to know my rights.

Have a great weekend.

I believe the law in 49 states would be on your side (I'm never sure about Louisiana) . Some states have upped the limit to $5000 instead of $500 for the written contract requirement, but it seems that this is still over that limit.

 

[jokestr]

I am out of state (CO), and last week put down a $500 deposit on a used car from Bertera Chevy in Palmer, MA. I did this so the car wouldn't be sold and was told "it is refundable if you decide that you don't want the car".

After applying for the loan and asking them to overnight me the paperwork. I cautiously reconsidered after receiving the paperwork and see the total cost of the loan. the $19,000 loan would cost me almost $6,500 over 72months. Prior to putting together the paperwork and fedexing, we had gone over all of the numbers over the phone. That is, all except for the whammy number, the cost of the loan.

I then dug deeper and downloaded the pics of the car online, enlarged them as much as my computer would allow, and scoured them. I then was able to see a considerable amount of cosmetic damage to the rear side of the car.

With the high loan cost and the newly discovered damage, I called today and told them I am not going through with the purchase. They stated that they may not give me my deposit back since they have already "prepared the car for delivery" and because I'm "canceling in the 11th hour of the sale".

I have NOT signed any paperwork, and no longer want the car, or to deal with those people. How can I get my deposit back.

They are telling me that I bought the car already, even though I haven't received the car or signed any contracts.

Any help would be appreciated!