Getting your money back?

Tom/Barb wrote:
When buying you place a deposit then must finance the rest, and find out you can't borrow the rest. would you expect to get your deposit back?

I would expect the seller to abide by the contract that they and I signed.

Nothing wrong with a non-refundable deposit. You have an option to agree with the terms or walk away.

Several years ago, I sold a boat and required the man to give a non-refundable deposit ($100.00 I seem to remember), with set terms on the amount of time they had to come up with the agreed upon purchase price. Wrote out the agreement on the hood of my truck, we both signed, and I made him a copy. I turned down several potential CASH buyers during that week of waiting. Had the deal not been finalized, I may have been out of a sale.

However, I would NOT deal with a dealer that required me to put down a non-refundable deposit. If I am seeking my own financing, I will put down a refundble deposit to hold an item...if it is dealer financing, then they can run the credit, find the loan, before they ever see a dime from me.

Definitely depends on how the contract is written. In most cases things like cars and homes have a clause that says if the borrower cannot secure financing all monies are returned, but not all.

Old-Biscuit wrote:
That's what a written contract is for.......spell out the details

I agree.

Not all people shop with pre-approved credit. It should be written in the contract: Sale contingent on loan approval by (name) of what ever financial institution you do business with. Your financial institution should be named. Otherwise if your loan is not approved, the dealer could possibly find a lender for you at an absorbent interest rate and pocket the down payment if you refuse.

At a dealership, as a general rule, you will get your deposit back if you are buying an in stock unit and using their finance department. Much different story if you are dealing with a private individual, asking them to hold the unit for you. Or ordering a unit from a dealer, and not telling them the sale is contingent on financing. Finally, if you tell the dealer you are paying cash, put up a deposit, have them modify or make ready the unit for delivery and then tell them you can't get the money, that's on you as well. The time to clarify the issue is before you put your money down, not after.

the bear II wrote:
Depends on what is written in the contract. I would not put down a deposit unless the contract specifies the deposit is refundable completely or with the exception of a small fee to cover the dealer expenses associated with a failed sale.

x2

That's what a written contract is for.......spell out the details

Why should your failure to qualify for a loan be on someone elses nickel?? Get qualified ahead of time.

Just depends. Look for the phrase "Non-refundable deposit".

About 4 years ago we attempted to purchase a new camper. We wrote a check for $1000 as a deposit and then had to wait for the credit. Our credit was good, but the loan was denied because the dealer valued the new camper higher than what the finance company thought it was worth. Dealer told us we'd have to come up with the difference and then we could finance. We chose not to take that route. We got our check back. It was never cashed.

2 years later we tried again (different dealer, different trailer). Same thing $1000 deposit check. Finance went through, check was not cashed until we signed the finished paper work. Check was included in the bundle of papers. About a week later, the check cleared the bank. Everyone was happy.