Can a used car dealer keep a down payment on a car that was never sold?

My 19 year-old son put $500 down on a vehicle and 2 days later decided that he didn’t want the car. The dealer is reluctant to give us back the money. My son never had possession of the car.

Asked on December 28, 2010 under General Practice, New Mexico

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

The purpose of the deposit is to get the seller to hold the vehicle by giving him the ability to keep the deposit if the buyer changes his mind, attempts to walk away from the sale, etc. This is exactly the sort of situation where a deposit would normally be kept, unless it was actually stated that the deposit would be refundable or there was some period during which your son could change his mind without consequence. It is very possible or even likely that the dealer has no obligation to return a deposit if your son, without any wrongdoing by the dealer, simply decided that he does not want this car. If you son wants *some* car from this dealer, perhaps you can get the dealer to roll the deposit, or at least most of it, onto another vehicle.


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