Is purchase contract void if the seller does not obtain the rate and terms promised in the contract?
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Is purchase contract void if the seller does not obtain the rate and terms promised in the contract?
We signed a purchase agreement to buy a travel trailer. After the contract went to the finance department they told us they could not obtain the finance rate that was stated on the contract. It would be higher than stated on the contract. It this grounds for us to cancel the contract because they were not able to meet their promise on the contract? We told them we did not agree to the increase of the percentage rate. They said they could not get it for us. Even if we put more cash down, it would still not bring it down to the contract promised amount.
Asked on October 12, 2011 under General Practice, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
For a definitive answer, you have to have the contract reviewed by some lawyer; the language of a contract is all-important in determining rights, obligations, etc. under it, since the specific terms of that contract control its interpretation and enforecability.
That said, as a general principal, IF the specific rate and/or other financing terms are incorporated into the contract of sale, there is a good chance that if those rates, etc. are not provided, that would consitute a material (or important) breach of contract terms and allow the seller to terminate the contract without penalty. It would be similar to the seller trying to change the base price of the vehicle, as reflected in the contract, after contract signing.
If the rate and other terms are not part of the contract of sale itself, then there probably is no breach of the sale contract by a failure to provide the hoped-for rates, and the contract would be binding on the buyer.
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