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You might be able to get a deposit back on a new or used car. But whether you actually will get it back depends on where you are purchasing, what deal you made, and your tenacity.
Consumer protection laws vary from state to state, but one myth prevails nationwide, according to Consumer Reports. Many people believe that they have three days to reflect on their car purchase before losing the deposit. That is a myth, the consumer protection organization says. Although there is a three-day rule to reflect on some consumer goods, it does not apply to deposits on new or used cars.
Dealers Talk Deposits
Many new and used car dealerships will demand a deposit on a car, claiming it is required before they can look into financing. Or maybe the dealer created a false sense of urgency in you by claiming that there are other interested buyers just dying for the one car you want.
When you make the deposit, you sign some paperwork, which you probably don't read too carefully. Most likely, it says that your deposit is non-refundable.
The basis for the clause is usually that the deposit is a form of liquidated damages, an award to the dealer for whatever troubles you put them through by expressing interest in the car and not ultimately buying it. However, if you put down a thousand dollars or more, it probably is not a legitimate claim of liquidated damages ... but for the fact that it is in your contract.
The deposit amount is very unlikely to reflect the actual losses to the dealer because you had a temporary claim on the car. The problem is just that you will have to fight to get the money back. You may -- depending on the dollar amount -- seek the deposit's return via small claims court.
Ways to Protect Yourself
Like any salesperson, a dealer wants to close a deal and getting a deposit brings them one step closer to that goal, making a sale. But be extremely wary. Chances are good that you can leave the dealership without making a deposit, take the time to reflect, and return in a few days to make a purchase when you are really ready. No doubt the salesperson will be happy to see you then, too.
If you do end up shelling out money on a car you do not buy, speak to an attorney. You may not have to sue for the deposit if you are represented. Sometimes just having a lawyer speak on your behalf or write a letter is sufficient to convince the other party that you are willing to do whatever it takes.
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.