Texas 3 day cooling off law?
April 15, 2010 8:35 PM Subscribe
In Texas, is there a 3 day cooling off period when purchasing a used car?
I signed a purchase order for a car, and my loan fell through and they would not approve me. The dealer said at the time that the car still was not mine and I could not leave the lot with it until he got the loan from the bank. So he still has the vehicle on the lot but I cannot afford it without a loan, and wanted out of the deal. He said I must pay regardless, and now will not even take my calls or have a conversation with me about it. He has my deposit and will not return it. BUT, he also has re-listed the car for sale. I have heard mixed things about this law, and need to know if I have right to my money back and out of the deal. And, if I am stuck in the deal, and he has right to claim I own the vehicle regardless, does the fact that he relisted it for sale help me in any way?
I signed a purchase order for a car, and my loan fell through and they would not approve me. The dealer said at the time that the car still was not mine and I could not leave the lot with it until he got the loan from the bank. So he still has the vehicle on the lot but I cannot afford it without a loan, and wanted out of the deal. He said I must pay regardless, and now will not even take my calls or have a conversation with me about it. He has my deposit and will not return it. BUT, he also has re-listed the car for sale. I have heard mixed things about this law, and need to know if I have right to my money back and out of the deal. And, if I am stuck in the deal, and he has right to claim I own the vehicle regardless, does the fact that he relisted it for sale help me in any way?
Get a lawyer RIGHT NOW. The fact that they didn't give you your deposit back when financing fell through is EXTREMELY fishy sounding, even by the vanishingly low standards of car dealers.
posted by deadmessenger at 8:50 PM on April 15, 2010
posted by deadmessenger at 8:50 PM on April 15, 2010
Oh, and if you gave the dealer a check for the deposit, stop payment on that check immediately.
posted by deadmessenger at 8:50 PM on April 15, 2010
posted by deadmessenger at 8:50 PM on April 15, 2010
Response by poster: I tried stopping payment the very next day, but the bank said it was already deposited and they could not take it back (We both use Chase, so it went into his account immediately).
From talking with the bank, they said this happens all the time and most dealers will just void the deal, since they lost nothing. This guy is being very mean and trying to strong arm me and will not even take calls from me accept to say I owe him the money and hang up. I will get a lawyer ASAP, I just wanted to avoid doing that if possible. Thanks!
posted by jmg967 at 8:57 PM on April 15, 2010
From talking with the bank, they said this happens all the time and most dealers will just void the deal, since they lost nothing. This guy is being very mean and trying to strong arm me and will not even take calls from me accept to say I owe him the money and hang up. I will get a lawyer ASAP, I just wanted to avoid doing that if possible. Thanks!
posted by jmg967 at 8:57 PM on April 15, 2010
These people are good in Austin to get a really cheap consult with a lawyer and often reduced-cost services. If you got declined financing, you may have the type of finances that will qualify you for their lower-cost services.
posted by ishotjr at 9:07 PM on April 15, 2010
posted by ishotjr at 9:07 PM on April 15, 2010
At this point I think you should stop doing anything by phone. From now on everything needs to be done in writing so that there's a paper trail. So you shouldn't be calling him anymore, for any reason, and you shouldn't pay any attention or give any credence to anything that's not in writing either.
If you have any proof that he's re-listed the car, make sure you save that; I've no idea how significant that is, but it certainly doesn't indicate good faith on his part, just on its face.
He's playing nasty so it's time for you to start playing nasty back. I'd say get a lawyer and have your lawyer write up a warning letter letting him know that you intend to sue. If that doesn't get a response, then you start going through the motions and filing papers. I'd bet you that he'll blink first. At the end of the day, a car dealer's margins are pretty thin.
posted by Kadin2048 at 9:13 PM on April 15, 2010
If you have any proof that he's re-listed the car, make sure you save that; I've no idea how significant that is, but it certainly doesn't indicate good faith on his part, just on its face.
He's playing nasty so it's time for you to start playing nasty back. I'd say get a lawyer and have your lawyer write up a warning letter letting him know that you intend to sue. If that doesn't get a response, then you start going through the motions and filing papers. I'd bet you that he'll blink first. At the end of the day, a car dealer's margins are pretty thin.
posted by Kadin2048 at 9:13 PM on April 15, 2010
I'd advise against playing "nasty," as they will have vastly greater resources to screw you over to the point that you'll thank them for keeping your deposit. But considering filing a small claims suit isn't nasty to me.
But, yes, keep a paper trail. Write him a letter tonight stating that you don't think you owe him anything, and you're entitled to your deposit. Maybe you'll mention that you will file legal action against him for fraud or something like that, mention the Better Business Bureau, I don't know.
Is there a clause in the contract you signed that allows them to keep your deposit if your loan doesn't fall through? I'd guess there isn't anything that specific. The thing is, if he's really lost nothing, then you don't owe him anything, do you?
In all contract law, there is something that is required. It's called "consideration." That basically means that it's not a contract unless there's some quid pro quo. That means that the side paying the money has to get something in return. Have you gotten anything in return for the money you gave them? Seems not.
If there's no consideration, then there's usually no contract. It's just a promise. But courts are usually less likely enforce a promise than a contract.
This isn't "cooling off period" law per se, it's just contract law.
IANYL, and I know nothing about Texas law at all. Obviously, it would be better to talk to a lawyer. Good luck.
posted by jabberjaw at 11:44 PM on April 15, 2010
But, yes, keep a paper trail. Write him a letter tonight stating that you don't think you owe him anything, and you're entitled to your deposit. Maybe you'll mention that you will file legal action against him for fraud or something like that, mention the Better Business Bureau, I don't know.
Is there a clause in the contract you signed that allows them to keep your deposit if your loan doesn't fall through? I'd guess there isn't anything that specific. The thing is, if he's really lost nothing, then you don't owe him anything, do you?
In all contract law, there is something that is required. It's called "consideration." That basically means that it's not a contract unless there's some quid pro quo. That means that the side paying the money has to get something in return. Have you gotten anything in return for the money you gave them? Seems not.
If there's no consideration, then there's usually no contract. It's just a promise. But courts are usually less likely enforce a promise than a contract.
This isn't "cooling off period" law per se, it's just contract law.
IANYL, and I know nothing about Texas law at all. Obviously, it would be better to talk to a lawyer. Good luck.
posted by jabberjaw at 11:44 PM on April 15, 2010
Just a warning about the talk of "consideration" - IANYL but it's pretty clear that most sale contracts do not have any problem with consideration. You sign an agreement whereby you pay a deposit and then the balance and in return you get a car. The contract has consideration.
If you fail to pay the balance then maybe you have breached the contract and the other party is entitled to suspend future performance of the contract (i.e. delivery of the car) but that doesn't mean there's no consideration.
If there's a deposit, the contract will usually set out in what circumstances it can be returned and when the dealer can complete it.
Basically, it all depends on how the contract is drafted and you either need to read it, understand it and take it up with small claims, or if you can't do that then you either need to write the deposit off and count yourself lucky that your not being sued for the balance of the payment or get yourself a lawyer.
posted by Mattat at 3:53 AM on April 16, 2010
If you fail to pay the balance then maybe you have breached the contract and the other party is entitled to suspend future performance of the contract (i.e. delivery of the car) but that doesn't mean there's no consideration.
If there's a deposit, the contract will usually set out in what circumstances it can be returned and when the dealer can complete it.
Basically, it all depends on how the contract is drafted and you either need to read it, understand it and take it up with small claims, or if you can't do that then you either need to write the deposit off and count yourself lucky that your not being sued for the balance of the payment or get yourself a lawyer.
posted by Mattat at 3:53 AM on April 16, 2010
Response by poster: Thank you everyone, I think I know my next move now.
posted by jmg967 at 7:15 AM on April 16, 2010
posted by jmg967 at 7:15 AM on April 16, 2010
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These lawyers all agree that in Texas, there is no 3-day cooling off period
There is a 3-day lemon law, but it only applies if there are problems with the car.
(IANAL, etc)
posted by chrisamiller at 8:41 PM on April 15, 2010