If I financed a used car from a dealership and they cancelled the contract, what rights do I have?

I financed a used car, and 4 days later, they said that my credit did not allow me to be approved for the loan. Now they say that I have to come in to sign a new contract with a cosigner. They called my father with the same information, saying that he needs to come in to cosign, when he never agreed to do so. We were told by a friend that it might be considered material misrepresentation, because they implied that we were obligated to do so. Is that true? Now I have given the car back, and have not had my down-payment returned. How long do they have to give it back?

Asked on July 29, 2010 under General Practice, Colorado


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If they cancelled the contract, you need to have your down payment returned. They cannot keep your money while not honoring the contract. There is no hard and fast rule for how long they have, but if you can't get a committment as to when they will return the money, it may be time to speak with an attorney.

It's one thing if they "simply" violated their contract. If you believe that they deliberately made material (important) misrepresentations to you, then you might also have a fraud claim against  them. If so, that might increase what you could sue for. That would be another matter to discuss with a lawyer. Good luck.

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