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  1. #1
    Join Date
    Sep 2016
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    4

    Default Financing Fell Through for Dealer, Now Dealer Wants Car Back

    My question involves a consumer law issue in the State of: Ill

    I purchased a car about two months ago. I signed a contract agreeing to the finance deal we worked out. I was given possession of the car on 7/28/16

    Now as it happens, the financing the dealer secured, did not come through for the dealer.
    (The job that I had at the time I purchased the car ended, which in turn, resulted in the creditor canceling the financing for the dealer)

    Now the dealer wants the car back, and I'm pretty sure the dealer no longer has my trade in.

    Can the dealer do this? Wasn't a contract signed here? I mean I have had possession of the car for two months now.

    Why would they have given me possession of the car if the financing wasn't secure on their end? Did they screw up?

    I am willing and able to make the first payment, but they haven't given the information on who to make the payment to, despite my repeated requests.


    How binding is the contract we signed? Seems sort of sketchy, because it seems like they shouldn't have given me the car if the financing wasn't secure on their end

    I send an email on the due date, attempting to make the first payment.


    Thanks for any help in advance.

  2. #2
    Join Date
    Jan 2006
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    38,867

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    IF the financing was part of the contract, the dealer is stuck. If it wasn't, you need to either secure financing or return the car (and expect to pay depreciation costs)

  3. #3
    Join Date
    Sep 2005
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    98,846

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    Quote Quoting ejurado
    View Post
    Now as it happens, the financing the dealer secured, did not come through for the dealer.
    (The job that I had at the time I purchased the car ended, which in turn, resulted in the creditor canceling the financing for the dealer)
    So the lender approved the loan, but revoked the loan when it investigated your reported employment and income and determined that your income and employment claims were false or no longer true?

    How many days passed between the day you applied for the loan and the day you were fired from your job? Did you know that you were about to be fired? How many days passed between the time you were approved for the loan and the date the lender revoked your financing?

    How soon after the financing failed did the dealer ask for the return of the car?

  4. #4
    Join Date
    Sep 2016
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    4

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    Quote Quoting Mr. Knowitall
    View Post
    So the lender approved the loan, but revoked the loan when it investigated your reported employment and income and determined that your income and employment claims were false or no longer true?

    How many days passed between the day you applied for the loan and the day you were fired from your job? Did you know that you were about to be fired? How many days passed between the time you were approved for the loan and the date the lender revoked your financing?

    How soon after the financing failed did the dealer ask for the return of the car?
    At the time the contract was signed, all my income and employment claims were 100% true.
    I did not make any sort of false or untruthful statements about my income and employment status.
    I was fired about a week after I received the car.
    I had absolutely no idea I was going to lose my job, and it was a complete surprise. The company that hired me turned out to be a huge mess of dysfunction that ended up losing money by hiring me ( I was hired through a recruitment firm! The company paid money to hire me! ) But I did sign an employment contract with the company that did confirm my hiring as a full time employee, confirming my annual salary etc. etc. If the nature of the job was anything but permanent I would not have sought out a car loan.

    It has been about 50 days since the purchase, and I just found out about the finance issue this week, because I had to inquire about exactly who I needed to send the 1st payment to which they never specified. I sent an email today (the due is today BTW) stating that I do have the payment ready and am wiling and able to make the payment in accordance to the signed contract.
    So I found out about the finance issue 5 days ago. and the sale and contract was signed on 7/27.

    Again, thanks for the help so far.

    -Erick

    The financing was part of the contract, which states the monthly payment amount, the rate, etc etc.
    It doesn't mention anything about the company that was giving the dealer the money at all.

    What is also weird is that I received a rejection letter from the financing company it self. Not the dealer. I never directly applied for the loan through the lender the dealership was using.
    I have to admit I was surprised because I looked like I filled out the finance companies application, which I never did. Did they just go ahead and use my info and submit an application without my consent? I thought that was suppose to be handled through the dealer.

  5. #5
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    I cannot imagine the loan had not been processed within a weeks time

    I also have a hard time believing the dealer did not say anything for nearly 2 months. They have been through this too many times to let it go this long.

    Regardless: I'm outright changing my position. I suggest you read all contracts you entered into to see if there is anything in any of them that addresses this. You might want to read this as well. I have no idea if it applies but it may.

    https://www.ftc.gov/sites/default/fi...0011-58353.pdf

  6. #6
    Join Date
    Sep 2016
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    4

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    Well, I spoke to the dealer and within the conditions section he pointed this out:

    8. Failure to obtain proposed financing: Seller and purchaser intend that the retail installment contract for ordered motor vehicle executed between seller and purchaser will be assigned to a sales finance agency of the seller's choice. If financing cannot be obtained within 5 business days for purchaser according to the proposals in the retail installment contract executed between seller and purchaser either seller or purchaser may cancel the agreement show on the face of this order and the retail installment contract. In the event of such a cancellation, if the vehicle hereunder has been delivered to Purchaser, Purchaser shall, within two days of such notice return the motor vehicle to the sellers place of business etc. etc---basically giving me back my deposit or trade in and me giving them back their car.


    Seems like they were able to find financing within the five days, but it doesn't mention anything about what happens after five days.

  7. #7
    Join Date
    Nov 2015
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    47.606 N 122.332 W in body, still at 90 S in my mind.
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    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    A few things jump out at me. One is that, generally, car dealerships will not carry buyers themselves. They have lenders that they work with regularly and who may provide preferential treatment but that is not the same as the dealership providing the loan even though they get to choose the lender.

    Seller and purchaser intend that the retail installment contract for ordered motor vehicle executed between seller and purchaser will be assigned to a sales finance agency of the seller's choice.
    This says to me that the seller was not carrying the loan but a 3rd party was. You applied for credit from them and you would've held that loan contract, not the seller, but the seller got to choose the agency. After you were provisionally (I presume) approved for the loan and allowed to take possession of the car the material facts of your application changed. AS the loan was subsequently cancelled you have 2 days to return the vehicle. As there will be depreciation you may or may not get back any deposit or trade in value.

    The biggest misunderstanding I see is this; the car loan is not made to the dealer, it's made to you. THEY do not seek financing, YOU do. You do not make payments to the dealer, you make payments to the finance company. As I mentioned above, they may have lenders that they work with as a matter of routine but that doesn't mean that the dealer is taking out the loan. In the event that the loan fell through it becomes YOUR responsibility to seek financing and pay for the car. At the end of the day the dealer will not be paid for the car and you will not have paid for the car.

    Bear in mind that, if you keep the car it will likely be repossessed. I would return the car and try to get back what I could.

  8. #8
    Join Date
    Jan 2006
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    38,867

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    The problem that comes in for the dealer though is depending on how the contract is written, they could obligate themselves to carrying the loan if they cannot find a lender with the terms agreed to on the contract.

  9. #9
    Join Date
    Nov 2015
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    47.606 N 122.332 W in body, still at 90 S in my mind.
    Posts
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    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    I agree, but we're only seeing snippets and the snippets that we are seeing cover this in the dealer's favor. As we aren't seeing anything from the financing company, which is mentioned, we're pretty stuck with assumptions. At the end of the day the OP hasn't paid a dime beyond the trade-in for the car and has no financing. My usual assumption is that these contracts are drawn up pretty tightly to protect the seller by attorneys who know what they're doing.

    To me, I see some basic misunderstandings on the part of the OP. Misunderstanding that are going to leave him exposed.

  10. #10
    Join Date
    Sep 2016
    Posts
    4

    Default Re: Financing Fell Through for Dealer, Now Dealer Wants Car Back

    Well the dealer now has their car back but doesn't have my old car. It's at the wholesaler, I'm was told. They said they could get it back, but I suspect they are lying.
    But I now want my car back.

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