Can an auto dealer call the police and report a the car stolen even though vehicle belongs to the bank now?

Put $2000 down on a car and drove away. The dealer called back couple of days later and said the bank said that we needed to put down $1500. We did not have the money so I signed an IOU. The dealer told us to tell the bank that we gave them the downpayment of $3500 (even though it was only $2000). 1 1/2 months later the dealer still has not received the $1500. We have already spoken with the bank prior to this and told them what the dealer told to tell them; namely a downpayment of $3500. Now the dealer says they will call the police and report car stolen if they do not receive the $1500.

Asked on March 14, 2012 under Bankruptcy Law, Washington


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

It is entirely possible for an auto dealer to call the police and report a car stolen even though registered title is in the name of the lender that you have for it. However, from a legal perspective such a call would be improper and very well could amount to a false report.

The threats of the dealer to you for more money seems to be an attempt to extort you out of money. I suggest that you carefully read your purchase agreement for the car in that it controls the contractual obligations owed by you to the deal and vice versa. If you have honored the terms of the purchase agreement, I fail to see why you should pay the auto dealership any more money. I suggest that you consult with an attorney who practices in the area of contract law.

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