If I purchased a new car but my loan was subsequently denied, what are my rights?
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If I purchased a new car but my loan was subsequently denied, what are my rights?
I purchased a used vehicle from a dealership; a week later I was notified that my loan was denied. Now the dealership won’t call me back to return vehicle and produce my trade in. What do I do?
Asked on December 4, 2010 under General Practice, Virginia
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
You need to reference the terms of sale. The issue is whether or not the sale was stated to be contingent upon financing--as would often be the case if the financing was provided by the dealership--or was non-contingent--as might be the case if you tried to secure outside (e.g. bank) financing. If the sale was contingent on financing, then without financing, the sale is void--you should return the new car, they should give you back your old one. However, if the sale was noncontingent--i.e. if you simply bought the car, counting on getting the loan--then the fact that you did not get the loan does not void the sale. The dealership does not have to take back the car and return you old one; instead, you can likely be held accountable for the purchase price of the car and sued if you don't produce it. You need to look at the documentation, including any contract or agreement of sale, to see how this sale was strutured.
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