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  1. #1

    Default If a Car is Returned After Buyer Misses Payments, Does the Seller Owe a Refund

    My question involves collection proceedings in the State of: Arkansas
    I sold my car without a contract. The person was all ways late or did not pay the agreed upon amount. She missed paying for 9 days and was to pay weekly. The total amount she paid was $750 toward the entire cost of $2450. Am I required to give her back the money she paid as she had the car for 31 days.
    She called today wanting receipts for $450 of the amount she paid as she would drop off payment when she did pay before I could give her the receipt as she got off work before I did This has been a very tumultuous transaction. She received a receipt for the $300 she initially paid as we met in person. Do I have to give her the receipts or the money back.

  2. #2
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    I would advise her to return the car, have it checked out for damage, then refund her money and sell to someone with cash. Hopefully you did not transfer title also.

  3. #3
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    Quote Quoting katrinakathleen
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    I sold my car without a contract.
    Actually, you do have a contract, an oral one. Just as enforceable as a written one, just harder to prove the terms and conditions.

    Quote Quoting katrinakathleen
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    The person was all ways late or did not pay the agreed upon amount. She missed paying for 9 days and was to pay weekly. The total amount she paid was $750 toward the entire cost of $2450. Am I required to give her back the money she paid as she had the car for 31 days.
    No, you aren't obligated to give her back any money and you can sue her for any missed payments.

    Quote Quoting katrinakathleen
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    This has been a very tumultuous transaction.
    That's your own fault for selling a car without getting all the money at time of sale.

    Quote Quoting katrinakathleen
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    She received a receipt for the $300 she initially paid as we met in person. Do I have to give her the receipts or the money back.
    Arguing about a receipt is dumb. You admit she paid you, give her a receipt for what she already paid you. Make sure you keep copies. If you made the mistake of not keeping a copy of the first one, make up a summary of payments in duplicate and keep one for yourself.

    The alternative is to just take the car back and give her the money back that she has already paid or you'll be hassling with this for another year or two.

    If you already signed the title over, she can sign it back over to you and then you give her the money.

    Next time you sell a car don't make the same mistake. You're not smarter than a bank that won't lend somebody money.

  4. #4

    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    I now have the car back. She had the car for 31 days. She wants her $750 back. Do I have to return it?

  5. #5
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    Quote Quoting katrinakathleen
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    I now have the car back. She had the car for 31 days. She wants her $750 back. Do I have to return it?
    Here's how this works from a legal standpoint. Start with the premise that you cannot profit from her breach of the agreement. Doesn't matter how long she had the car.

    Resell the car. Let's assume it's still in the same shape as when you gave it to her. If you sell it for $2450 you must refund the $750 or you can be sued for it.

    If you are compelled to sell the car for less than $2450 due to market factors after making a reasonable effort to sell it for that amount you apply part of the $750 to your loss and refund the rest.

    But you'd better be able to articulate a good reason for selling for less and keeping some of the money because a judge will want to hear it and will award her the $750 if he's not satisfied with your reasoning.

    I suggest you send her written notice that she breached the agreement and you have to resell the car before she's entitled to any money back.

    Meantime, if you decide to keep the car you must return the $750 because you cannot profit from her breach.

  6. #6
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    Quote Quoting katrinakathleen
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    I sold my car without a contract.
    You say that you "sold" the car -- but are we in fact talking about a situation where the title remained in your name, and you planned to title the car over to the owner after the full purchase amount was paid?
    Quote Quoting adjusterjack
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    No, you aren't obligated to give her back any money and you can sue her for any missed payments.
    Casual readers, please note that adjusterjack gives a more complete explanation of the options and remedies in a later post.
    Quote Quoting adjusterjack
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    Meantime, if you decide to keep the car you must return the $750 because you cannot profit from her breach.
    In that context, there would be a plausible claim for ordinary wear and tear, as well as for any damage to the vehicle. The IRS guidelines for mileage reimbursement are often useful as a basis to argue ordinary wear and tear.

  7. #7

    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    I checked the IRS guide for mileage reimbursement and for 2014 it is 56 cents a mile. She pit 1200 miles on the car in 31 days. If I mukfiply the miles times 56 cents that comes to $672. Can I deduct $672 from the $750 she paid me and pay her $78?

  8. #8
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    You can propose that to her; we cannot promise that she'll accept that resolution. If you and she cannot come to an agreement, one or the other of you can resort to small claims court.

  9. #9
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    Quote Quoting katrinakathleen
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    I checked the IRS guide for mileage reimbursement and for 2014 it is 56 cents a mile. She pit 1200 miles on the car in 31 days. If I mukfiply the miles times 56 cents that comes to $672. Can I deduct $672 from the $750 she paid me and pay her $78?
    I seriously doubt that you'll get away with that in court. The IRS mileage deduction isn't for wear and tear, it's based on the fixed and variable costs of owning a vehicle over a long period of time.

    It's also for business use and doesn't contemplate personal or commuting use.

    1200 miles in one month does not put significant wear and tear on a car.

    If you end up in court over it I think you will lose, especially if you didn't have to spend that money on repairing the car.

  10. #10
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    Default Re: Sold Car Without Contract, Late Payments, Buyer Feturned Car, Wants Money Back

    One thing appear obvious, she is poor and desperate for transportation. We do not know your financial situation. I have $2500 cars because I buy mine new and keep them until then they reach the point breakdowns are not worthwhile. If you are rich, why not keep the $750, donate the car to your church as a designated donation so it is tax deductible to you and they can give her the car. Use the $750 to register, tag and insure the vehicle. My family has given away multiple cars that way.

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