Unhappy with deal. Want to cancel Purchase Agreement.

[stoutz429]

We have been negotiating the purchase of a used class A motorhome over the last few days. The negotiation has progressed to the point where we have signed a Purchase Agreement and placed a down payment on the unit.

Even though the RV is 12 years old, we told the dealer up front we would have to finance part of the purchase price. We placed a deposit to hold the vehicle while the dealer reviewed our offer.

As it worked out, our offer was accepted. The sales rep then used our deposit as down payment money. He told us that used RVs usually finance at around 6%. We used this rate when crunching the numbers to see if the deal would work for us.

When the dealer's finance person shopped for financing, she was only able to get it at a 14.95% rate. This totally blows our number crunching out of the water, as we were expecting a much lower rate (and yes, we know most lenders won't even consider financing an RV this old).

The bottom line is, we have signed a Purchase Agreement, made a down payment, and applied for financing through the dealer. However, now we are very unhappy with the deal because of the large difference in the finance rate.

My question is, can the deal be canceled even though we signed a Purchase Agreement prior to learning about the poor financing rate, and if so, would the deposit/down payment money be lost?

[hoojs]

Duplicate

[hoojs]

Not complicated at all. If you didn't sign any of the finance paperwork, then there is no deal. You don't own it as the dealer has not been "paid" the full amount. Plain and simple. Any dealer with any real business will give you the deposit back. If they don't ask for the manager, then call the Better Business Bureu. Assuming you have not signed any finance contract they will give you your deposit or ask if you want to work a deal on another unit. They CANNOT make you sign a finance contract regardless of what was discussed or put in writing on a buyers order/purchase agreement. That's why they have those 4 big box's on any finance contract. Rate, term payment, total cost to finance. That's why

[JALLEN4]

Bumpyroad wrote:

westernrvparkowner wrote:

wa8yxm wrote:
In most states you have a period of time to "Change your mind" and cancel.. The period of time may vary from state to state. I have seen judges honor a cancel request at six years.. (very rare and in my opinion the wrong thing to do in that case but hey, I was not the judge).

Cooling off periods, rights of rescission and anything similar applies to situations where the seller comes to your home. If you go to their place of business and buy something, in most all circumstances you own it. The exception would be if there were clauses in the contract that gave you an out. I couldn't imagine a situation where a judge gave someone six years to cancel a contract. Sure would like to hear the details on that.

I thought there was some clause used to describe this change of mine, a "heat of the moment deal" or something. not a voluntarily entered into contract.
bumpy

In no state is there a law that gives the consumer any right of recission on a purchased motor vehicle. None!

The closest thing to this is a convoluted California law where the purchaser of a used vehicle can buy a form of insurance at delivery which would allow a brief period of time to make a return of the vehicle.

The door to door provision on vehicles would only be valid if the purchaser bought and took possesion from an unsolicited salesman making a visit to their home and never called or went to the dealership.

[Bumpyroad]

westernrvparkowner wrote:

wa8yxm wrote:
In most states you have a period of time to "Change your mind" and cancel.. The period of time may vary from state to state. I have seen judges honor a cancel request at six years.. (very rare and in my opinion the wrong thing to do in that case but hey, I was not the judge).

Cooling off periods, rights of rescission and anything similar applies to situations where the seller comes to your home. If you go to their place of business and buy something, in most all circumstances you own it. The exception would be if there were clauses in the contract that gave you an out. I couldn't imagine a situation where a judge gave someone six years to cancel a contract. Sure would like to hear the details on that.

I thought there was some clause used to describe this change of mine, a "heat of the moment deal" or something. not a voluntarily entered into contract.
bumpy

[westernrvparkow]

wa8yxm wrote:
In most states you have a period of time to "Change your mind" and cancel.. The period of time may vary from state to state. I have seen judges honor a cancel request at six years.. (very rare and in my opinion the wrong thing to do in that case but hey, I was not the judge).

Cooling off periods, rights of rescission and anything similar applies to situations where the seller comes to your home. If you go to their place of business and buy something, in most all circumstances you own it. The exception would be if there were clauses in the contract that gave you an out. I couldn't imagine a situation where a judge gave someone six years to cancel a contract. Sure would like to hear the details on that.

[wa8yxm]

In most states you have a period of time to "Change your mind" and cancel.. The period of time may vary from state to state. I have seen judges honor a cancel request at six years.. (very rare and in my opinion the wrong thing to do in that case but hey, I was not the judge).

[dbs944]

Shop around and refi it a lower rate - you'll be way ahead.

We got 6% from USAA on a 12yo MH. Application over the phone and finalized within 45 minutes.

[tafman618]

Not that it probably matters now, but I would have questioned the price drop. The dealer dropped the price to accommodate the desired monthly payment amount if a lower interest rate were available. Obviously the dealer had some wiggle room in the price and was still able to make a profit. Ideally, the buyer may have saved some money by obtaining the lower sale price and then looking for a loan with a lower interest rate.

Sometimes buyers accept a monthly payment because it fits their current budget. However, they fail to recognize what the total cost is at the end of the loan. Not sure what the starting or ending sell price was, but I put together an example reflecting assumptions to give you an idea of pricing. In the example, the starting price was $20.0K then dropped to $15.0K. Loan duration remained constant at 8yrs/96 mos. Interest rate is 14.95%; then 6.75% to show comparison.

SAMPLE COSTING FOR RV PURCHASE
Purchase Interst Term Monthly Total Interest Paid
Price Rate Pmt Repayment Paid on Loan
$20,000.00 14.95% 8 yrs $358.33 $34,399.68 $14,399.68
$20,000.00 6.75% 8 yrs $270.19 $25,938.24 $ 5,938.24
$15,000.00 14.95% 8 yrs $268.75 $25,800.00 $10,800.00

[Francesca_Knowl]

Hooray!

All's well that ends well- it sounds like the dealer did just the right thing.

And thanks a million for posting the outcome- so many folks forget to do so...

[VinCee]

Glad everything worked out for you. Congratulations on the new rig and many happy fun filled safe miles of adventure!

[musicman54]

congrats and enjoy your new to you toy many memories

[stoutz429]

OP here with good news. After very friendly conversation with dealer expressing our concern over the interest rate, they offered to restructure the deal by reducing the purchase price to an amount that would create monthly payments that fall to a level nearly equal to what we would have paid with our desired interest rate.

So the bottom line for us becomes a total purchase amount that we feel is right in line with the amount of risk we are willing to take for a motorhome this old.

We can't praise the dealer enough for their professionalism and understanding as we stumbled through the purchase process. We learned a lot from our mistakes on this one and will be much better prepared when the day comes to buy our dream machine for fulltiming after retirement.

Many thanks to all of you who responded to our post. The guidance we took from your suggestions was invaluable to getting the deal we could feel comfortable with.

[VinCee]

I just wonder why the OP doesn't just either cancel the check or credit card they used for the deposit. Doubt they paid cash, and if they did then the financing should'nt be an issue. Their financial institution should back them up on the cancel if they are good customers and have been so for a number of years

[papa_peter]

Maybe it's just me but the first place I would ask questions is with the dealer ... sales person, finance officer, and/or manager/owner. No offense but I wouldn't be posting that question on this forum until I found out what the dealer says ...

Kind of strange that the OP has not responded to his post! Has he been back to the dealer? Has he read the fine print in the agreement? if so then what does the agreement say?

When I was in the Navy in the 1970s I ran into a zillion sea lawyers!!! Nowadays I guess they call themselves arm chair lawyers ... I'm not a lawyer, I just watch them on TV 🙂