What are my rights if I’m selling a car to a guy on a payment plan but he missed his last payment and it’s past the grace period he agreed on?

We both signed a paper contract. Am I OK to sell the car to another buyer?

Asked on August 11, 2015 under Business Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

The answer depends on the specific facts. A party's breach of contract may be considered to have terminated the contract if the breach is "material," or significant in the context of the agreement. Missing the grace period by a few days, especially if the buyer has already made a number of payments, is different than missing it by several weeks, or eary in the agreement or plan. The former would likely not be considered material, while the lattet probably would be. Courts also weigh the reasonableness of the non-breaching party's conduct. A good idea would be to send the buyer, some way or ways you can prove delivery (e.g. certified mail or fed ex with tracking) a letter reminding him of when the payment was due and giving him, say, 10 business days yo mke the payment or you will consider him in breach. Having given him a reminder of his obligations, a warning, and extra time, you'd be on much firmer ground to then consider the contract terminated if he still does not pay.


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