Question regarding deposit when buying vehicles?

If you give a guy a deposit when buying a used vehicle and then back out of the deal what should happen with the money?

I for one will give it back….but I can see others just keeping it. Obviously they could be turning away other potential buyers.

My sister gave a guy a $500 deposit on a used car and now they don’t want to buy it, and the guy wont give their check back.

This got me thinking what good is a deposit if the buyer will just get their money back if they back out of the deal 3-4 days later. Is it assumed by many that you forfeit this if you back out of the deal? I for one would never give that kind of deposit in the first place…just more curious on what others think about this?

It can go either way depending on the other party. It is always best to have your ducks in a row before putting any money on the table

I cant imagine giving a deposit on a vehicle unless its the same day I get the keys. But in my mind a deposit should be returned if the deal does not take place. Sounds like some scumbag just stole from your sister.

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I cant imagine giving a deposit on a vehicle unless its the same day I get the keys. But in my mind a deposit should be returned if the deal does not take place. Sounds like some scumbag just stole from your sister.

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Well, if you look at a car after work and need to securing financing and get a bank check…usually that can’t be done in the same day. I have given deposits on vehicles without issue for this reason, but I always have the details figured out before hand.

never do this. lots of cars out there. there will always be another one. sorry if this not the answer you want to hear. Car salesman ALWAYS have “another person interested in it”.

I was decideing between 2 vehicles this past fall and the one guy insured me that his vehicle would be gone soon. i decided on the other vehicle and the “insured” vehicle is still in the guys lot.

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I cant imagine giving a deposit on a vehicle unless its the same day I get the keys. But in my mind a deposit should be returned if the deal does not take place. Sounds like some scumbag just stole from your sister.

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Well, if you look at a car after work and need to securing financing and get a bank check…usually that can’t be done in the same day. I have given deposits on vehicles without issue for this reason, but I always have the details figured out before hand.

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Understood. I would insist they hold it for nothing. If they cant show that little amount of respect for a customer then they should not get the business.

I’d think them details should have been worked out before the money changed hands, while he may be considered a scum by some, I’m not so sure, he kept the vehicle off the market because somebody wanted it, then backed out, he may have lost the sale from other buyers.

For people I don’t know, I’ll generally keep the deposit, to many say they’ll buy something and then shop around while you sit on what your trying to sell waiting.

A non refundable deposit means you will be back..

Al

I bought my last vehicle from Luther Chev and put a 500.00 deposit on it. I was waiting for an insurance check before finalizing the purchase. They wanted the deposit in order to make sure they didn’t sell it to someone else. I thought that was a fare request. They also made it clear, if I wanted to walk away from the deal, I would get my check back (no questions asked). Is it too late to cancel your check?

I personally would not take a deposit on something. It is actively on the market until someone pays in full. If you don’t have the money right now, come back when you have it. I will sign the title to you at the DMV, get the cash, and you get the vehicle.

There is no questions.

I think both parties in this situation messed up. Try to cancel the check, talk to your banker about the situation, but if it has cleared the bank, I think she is out the cash. Maybe try small claims court in that case, but I don’t know how the law would read on this.

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I bought my last vehicle from Luther Chev and put a 500.00 deposit on it. I was waiting for an insurance check before finalizing the purchase. They wanted the deposit in order to make sure they didn’t sell it to someone else. I thought that was a fare request. They also made it clear, if I wanted to walk away from the deal, I would get my check back (no questions asked). Is it too late to cancel your check?

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My sister put a stop on the check. This was with a private party, not a dealership. I personally have never had any issues and have no problem giving a small check to hold a vehicle while I secure a bank check.

I can see it both ways….but I guess determining if it is a non-refundable deposit with any party before making the exchange would be a good thing to discuss.

I know I have passed on other offers when selling a vehicle, only to have the guy stating he was going to buy it back out and then the guy that I turned away is no longer interested. Live and learn I guess.

Take him to court and let the judge decide. Pretty easy to do. He the guy decides not to show up you win. Then its just a matter of getting the money back from him.

I would have a deposit slip made up that the money would be returned if loan not secured or car does,nt pass mechanics inspection.

Canceling a check is not a guaranty. If they still have the check it still can be submitted for payment 6 months down the line. After 6 months you can ask to extend it but it will cost another fee. So have her keep an eye on her account 6 months down the line.

Going to court is no guaranty either if judgment is awarded, thats just half the battle the rest of the battle is collection and that can be a nightmare of red tape, fees and waiting.

I personally would give the deposit back if it were 1 or 2 days but a lengthy wait on my end, I may not. After 2 days it goes back on the market, I would explain this to the buyer, and the one who pays in full first wins.

I ask why does anyone EVER give a deposit ? This post reminds me of the Seinfeld episode where Jerry went to get his rental car and they didn’t have any… he made a reservation and it didn’t mean squat. He went on to say , anyone can “take” your reservation..the trick is to “keep” the reservation And she says “I know what the reservation is for” and he says.. “I don’t think you do, or I would have a car” Turn the scenario around… you put a deposit on something that you absolutely want, a one of a kind & they tell you they will hold it for a good faith deposit, so you can procure the remaining funds to close the deal. They then proceed to sell it to the next guy that comes along… are you happy ? At the dealership, we take deposits on used cars all the time and ALWAYS give them back… should we ? Just a good business practice… now if I am selling you my used widget personally and you give me a deposit and I “hold” it for you… your out.. otherwise… “what the he77 good is a deposit for, the buyer, what does he need protection from ?”

My sister put a stop on the check. This was with a private party, not a dealership. I personally have never had any issues and have no problem giving a small check to hold a vehicle while I secure a bank check.

Since you stopped payment on the check, you just cost the seller $35 bucks in a returned check fee from his bank because you backed out of the deal.

Woopty doo! The guy should not be keeping a deposit on something that she is not purchasing unless it was agreed upon prior to the deposit. That is just cheesy.

I don’t get it. What’s the point of a deposit if the seller gives it back just because the buyer changes his/her mind?

This is a serious question. I have a truck for sale on craigslist right now, and am thinking about also listing it on cars.com or elsewhere. I may find myself in the seller’s position very soon hopefully.

When I bought my boat I gave the seller $300 cash. It was a Saturday. We had to work another meeting that week into our schedules to complete the purchase because I needed to get a cashier’s check from my bank. I gave him that $300 fully expecting that if I backed out of the deal that money was no longer mine.

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I don’t get it. What’s the point of a deposit if the seller gives it back just because the buyer changes his/her mind?

This is a serious question. I have a truck for sale on craigslist right now, and am thinking about also listing it on cars.com or elsewhere. I may find myself in the seller’s position very soon hopefully.

When I bought my boat I gave the seller $300 cash. It was a Saturday. We had to work another meeting that week into our schedules to complete the purchase because I needed to get a cashier’s check from my bank. I gave him that $300 fully expecting that if I backed out of the deal that money was no longer mine.

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That’s the way I’d normally see it, but evidently others feel that the deposit is kind of like saying, I’ll take it..well unless I change my mind, but you can’t sell it till then.

Al

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Since you stopped payment on the check, you just cost the seller $35 bucks in a returned check fee from his bank because you backed out of the deal.

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That may be the case. It’s between them….could have been handled better to begin with.

I was just curious how others feel about deposits and how they handle them.

I have never had any issues.

A deposit only means what the seller and buyer want it to mean. They both must agree. Many like myself would not give a car dealer a deposit. Many would.

We recently were in the market for a car for our son. There was a vehicle that we wanted to buy, but we wanted our mechanic to look at it. We were upfront with what we wanted to do. We gave the seller a check for the full amount with the stipulation that if our mechanic found issues, we could bring the vehicle back and get our check back. Communication is the key, in my opinion.

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A deposit only means what the seller and buyer want it to mean. They both must agree. Many like myself would not give a car dealer a deposit. Many would.

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I get that, sort of. But what purpose does a deposit check serve if I as a seller am expected to rip it up if the buyer flakes out and changes his/her mind? I wouldn’t be able to cash it right away, so it’s not like it helps provide float until I get the full payment. So the only purpose would be to provide a name and address?

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A deposit only means what the seller and buyer want it to mean. They both must agree. Many like myself would not give a car dealer a deposit. Many would.

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I get that, sort of. But what purpose does a deposit check serve if I as a seller am expected to rip it up if the buyer flakes out and changes his/her mind? I wouldn’t be able to cash it right away, so it’s not like it helps provide float until I get the full payment. So the only purpose would be to provide a name and address?

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Exactly, a deposit is a deposit for a reason… if you just give it back to the would be/wannabe buyer anyways, it means absolutely nothing. Why even bother ??? Very honest question, why even bother ? BECAUSE it means “consider it SOLD” DO NOT sell to the next guy to come along. It does not mean, “here, hang onto this cash until I make up my mind and then give it back when I back out”

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A deposit only means what the seller and buyer want it to mean. They both must agree. Many like myself would not give a car dealer a deposit. Many would.

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I get that, sort of. But what purpose does a deposit check serve if I as a seller am expected to rip it up if the buyer flakes out and changes his/her mind? I wouldn’t be able to cash it right away, so it’s not like it helps provide float until I get the full payment. So the only purpose would be to provide a name and address?

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Personally I expect these kind of things to be settled with a handshake and a word and I usually wont settle for anything else. Dont worry. My kind are fading fast…

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A deposit only means what the seller and buyer want it to mean. They both must agree. Many like myself would not give a car dealer a deposit. Many would.

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I get that, sort of. But what purpose does a deposit check serve if I as a seller am expected to rip it up if the buyer flakes out and changes his/her mind? I wouldn’t be able to cash it right away, so it’s not like it helps provide float until I get the full payment. So the only purpose would be to provide a name and address?

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Personally I expect these kind of things to be settled with a handshake and a word and I usually wont settle for anything else. Dont worry. My kind are fading fast…

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Your right Because the handshake has been lowered to just another ritual.. it has been replaced by the $500 deposit Next question, if you “shake” on buying a item on tuesday, to pay & pick up thursday, can you ever change your mind ?

So, if u put down a deposit for cabin, then back out, do u get that back? If I put a deposit on something to hold it, I expect to lose it if I change my mind.

I’m sure she got a receipt of some sort showing the down payment towards the agreed upon purchase price. If she did I’m sure the seller would include a period of time in which she needed to close the deal. Failure to do so would forfeit the down payment.

When dealing with a private party it’s called “buyer beware” for a reason. Her recourse is squat in this case. In fact, if the seller chose to take HER to court for stopping payment he would win.

Dealing with dealers you have some protection from the state. Private parties are on their own.

Somebody, either her or the seller will have learned a lesson from this.

Passing a worthless check in MN (stopping payment without “cause”) is considered fraud.

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Passing a worthless check in MN (stopping payment without “cause”) is considered fraud.

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But the upside is it was only $500 so it isn’t felony fraud.

In this case I would expect to get my deposit back once the item was sold, otherwise the seller is double profiting.

I get the fact that the seller held the item and may have passed on selling to others, but once the item does sell, the deposit should be returned.

IMO