Car Dealer trying to get me to sign a new contract

[windingmeupagain]

California

My case is very similar to one being discussed in this forum. I purchased a new car from a Honda dealership and I apparently qualified for a new grad discount even though I don't finish my final course until the end of Fall. It gets the dealer $500 which they in turn applied towards my down payment. They did not list it under "rebate" on the Retail Installment Sales Contract. Instead they listed it under "other".

When I bought the car they had me fill out two contract. One with the $500 credit and one without. They said the only thing I needed to do was bring in my official college transcripts within 7 days or I would not get the discount. I brought them the transcripts 4 days later and they poured over them for about an hour then sent me to finance to sign the sales contract which includes the $500 discount. Both the dealer and I signed the contract and he verbally said if Honda doesn't pay us you may need to pay us back the $500.

Two weeks later they called me and told me that Honda Corporate did not accept the transcripts I provided and that they are nullifying the sales contract I have and I need to come in and sign a new one that does not include the $500 discount. I have already put $3,000 down and I already have financing through a credit union that I am planning to complete this coming week. The Honda dealer told me they will repossess the car if I don't come in and sign the new contract by July 31.

I told them that they signed an arbitration agreement along with me for any disputes related to the sales contract etc. They told me that does not apply and the contract is not valid.

I am not planning to bring the car back to them or sign a new contract. I want them to take me to court (small claims or the arbitration-which they have to pay for). When we originally made the deal there was no mention of if Honda does not accept my transcript, only that I need to bring them transcripts which they actually looked over then sent me home with a signed contract. I believe it's their fault for sending me home that day with the discount after having a chance to go over my provided documents.

 

[adjusterjack]

You have nothing to sue for until they actually do something bad to you.

Meantime, stand fast, tell the dealer to pound sand and you will sue them AND go public if they keep screwing around with you.

 

[justalayman]

You may want to reconsider. The problem is the current contract has the $500 listed as a credit. That credit has not been received and apparently won’t be.
That discount is also contingent on financing through Honda motor company. Apparently you were turned down for credit with Honda.

I highly suspect the contract was written to account for the possibility of of this situation. Read everything you have very closely. I think you’re going to lose on this but push it as far as you want to make your point.

 

[justalayman]

You have nothing to sue for until they actually do something bad to you.

Meantime, stand fast, tell the dealer to pound sand and you will sue them AND go public if they keep screwing around with you.

he’ll sue for what? He’ll go public with what? The fact he didn’t qualify for the financing that allowed for the discount and now th dealer wants the rest of their money.?

Regardless of anything else, I see nothing he could sue the dealer for. What do you see that isnt there?

 

[windingmeupagain]

I was qualified by Honda Financing for the loan. However, I have a better interest rate through my credit union and planned to pursue financing through them. I was told by the dealer that I have to make 3 payments to Honda Finance before I can refinance with another company. I will have my credit union confirm that. I want to get this away from Honda Finance as quick as possible. In the meantime the Honda dealer says this contract is invalid but they have not explain to me why it's invalid. I think based on them telling me verbally that if the $500 was not approved by Honda Corporate I would have to pay. However this was never brought up until 4 days later when I brought them my transcripts. I would have never agreed to those terms as it puts all the risk on me. I may have agreed to split it 50/50 but on the day I negotiated the car it never even came up. They only told me I would lose the discount if I did not bring in my transcript. They said nothing about losing the discount if I was not approved.

The $500 was put towards the down payment and listed on the contract as paid for by American Honda Motors. So the contract shows $3,500 for the down payment since I put down 3k.

The form filled out is a common form used by dealers (form 553-ca-arb). The part I may not understand is that I thought this was a binding contract (seller and buyer signed it)? The Honda dealer said that this contract is invalid. I pointed to them that we both signed it and it has an arbitration clause for any disputes and they would have to pay for the arbitration process (as described in the contract). They told me they will repossess the car if I don't pay the $500 by July 31. It sounds wrong and maybe even illegal to me but I'm not an expert in this area.

 

[justalayman]

Is it binding? I presume so, at least on the parties to the contract. Honda finance is not a party to the contract so it isn’t binding on them. Iif the credit is noted as being from Honda finance and they will not pay it, well, if you notice it is applied as a credit to your purchase price and not used to discount the price you paid for th car.

The best I can say is read the contract thoroughly. Contracts used by dealers tend to allow for things such as you are dealing with.

 

[windingmeupagain]

ok thanks. fair enough but if I end up having to pay the $500 I most likely don't need to draw up a new contract correct? I just have my credit union pay the balance on the financing. I just don't want to draw up a new contract because I'm afraid they will try to screw me some other way. They actually ended up selling me an alarm system by lying to me. They told me that my insurance carrier would knock down my rated by 10-15 dollars a month. Turns out it was BS but that was all on me. I should not have bit on that. I know better for next time.

 

[justalayman]

I wouldn’t see a reason for a new contract. As long as the $3500 total down payment is paid it doesn’t affect the contract itself.