Your Rights When Paying A Car Deposit By Graham Hill
Friday, 4. March 2016
When people hear about me and leasing a little late in the day. It is often the case that someone goes into a dealer, test drives a new or used car, negotiates a deal and pays a deposit, often much more than he or she needs to.put down.
They then find out, after contacting me, that there is an amazing deal on a new car that makes the cost cheaper than the used car or by choosing a different finance method can save a lot of money on the same new car supplied through me. As a result he wants to cancel his order with the dealer. Now legally this is a breach of contract but the good news is that the dealer can only legally recover his costs which must be ‘reasonable’.
So if you have paid £1,000 deposit and you cancel the order he has no right to keep the £1,000. He may be entitled to a few pounds admin costs and maybe a few pounds to re-advertise the car but that’s it, he must refund the balance. If he carries out a service and MOT at your request he may also recover those costs but even that is debatable because both add value to the car when he re-advertises.
My advice is pay as little as possible, say £100, and pay by credit card, it increases your legal rights phenomenally, even more so if you end up buying the car, especially if you pay the balance in cash. And if a dealer tries to keep your deposit get straight on the phone to your local trading standards office. By Graham Hill
