Can You Rescind an Auto Purchase

How long do I have after a purchase to return the vehicle because of breach of contract?

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Bill's Answer: Answered by Staff

Generally speaking, there is no time period during which you can return a vehicle and cancel the sale. The existence of this right, called a “cooling-off period,” is a common misconception among American consumers. Once you sign a purchase contract with a dealer, you are basically stuck with the car, unless you can prove that the dealer intentionally misled you about some aspect of the contract or vehicle, in which case you can sue the dealership and finance company in an attempt to have the contract voided. In real life, it is almost impossible to prove that a car salesman lied to you about a vehicle, as you likely have no written evidence to back up your claim. This type of case is basically your word against the dealer’s word, which makes proving wrongdoing very difficult. In addition, purchase agreements are usually written to favor the dealer, so establishing that the dealer breached the contract will likely be an uphill battle.

You will almost never find a dealership who will willing accept the return of a vehicle and the cancelation of a sale because the buyer alleges breach of contract or buyer’s remorse. If you believe that the dealership intentionally misled you about the terms of the contract or the condition of the vehicle, you can sue to have the contract voided, but proving these allegations will be difficult. I encourage you to seek the advice of an attorney if you feel that you may have a case against a dealership for breach of contract. An attorney licensed in your state will be able to advise you of the strengths and weaknesses of you case, and whether filing a lawsuit is appropriate.

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Comments (70)

Eli C.
Fresno, CA  |  February 27, 2014
I live in Fresno Ca. I bought a car sight unseen from a dealership in Omaha Nebraska. A 1986 Porsche 951. The dealer is a "classic & sports car" dealership specializing in European cars. My salesman was none other than the owner of the dealership. Ihad been searching for several months for a low mile, first class condition car that would be considered club event winning condition or just shy of concours condition. Thru a month's negotiations & assurance this car met my needsh& desires, I agreed to buy it for an above market value. The dealer sent me all of the required purchase documents/contracts via mail. My enclosed transporter arrived ahead of schedule to pic up the car. I signed & emailed a photocopy of the Bill Of Sale to the dealer in order for them to release title. When the Porsche arrived in Fresno, it was not of the condition as described. In fact it was a 5 out of 10 when I had been sold a 11 out of 10... Ironically, I maintained possession of the unsigned purchase contract, tax disclosures & other forms. The delivery date was 8/13/13. On the 23rd I received 2 emails requesting signed documents in order to finalize the transaction. I've since contacted my attorney & dealt with the BBB of Nebraska. Its now Feb 27 2014 & I'm beginning arbitration. Simply based on the cactfact cactfact that iI have not signed any purchase contracts, should iI expect this to be an oopen & closed case with arbitration?
March 10, 2014
Consult with a California lawyer who has experience in consumer law to learn what cause of action you have against the dealer.
Teri B.
Houston, TX  |  February 16, 2014
We were looking at cars, knowing that we were waiting on a settlement check from our insurance. The dealership said we should just "get it done" and could give them the cash when we received the check. We gave them a check to be deposited upon receipt of our insurance payment and a the insurance company sent a promissory letter that we are guaranteed the funds. Due to a mistake on our insurance's part, we have not yet received our money. The insurance company called the dealership and acknowledged that it was their fault, and we would in fact get the money, but it would be 4 more days until we received payment. Our bank requires a 7 day hold so it would be over a week until we could pay the promised cash, so the dealership required us to return the car until we could give the payment. Are we required by law to adhere to our contract with the dealership? They have possession of the car and will not release it to us for another 10 days, but have a signed contract as of two weeks ago. I am unhappy with the way we have been treated. I understand their reason, but they will not take our calls, and my husband was left stranded with no ride upon returning the car. The customer service is irritating, and I am considering just going else where if I am not legally bound to the car.
February 18, 2014
Take your sales contract to a lawyer in your state who has consumer law experience. Ask him or her to read your contract and give you an opinion if you can cancel the contract without recourse.
Patti S.
City Of Newark, DE  |  December 28, 2013
I bought a used car on December 3, 2013. We wanted to put it in my 24-year old daughter's name, was told from the dealership her credit was not good so we should just put it in my name. Two weeks later, the finance company contacted me wanting to know why she was not on the loan and that this was not legal. I think it was called a straw-man purchase. We had to go back in and sign papers again with her on the loan. Yesterday, while driving the car it started smoking and smelling like it was on fire. We had it towed to the dealership. I called this morning and they told me the car needs a new clutch. They want me to pay for it. It has been driven only 80 miles. My first car payment is not due until 1/16. What can I do? Can I get out of this car loan?
December 30, 2013
Contact your state attorney general to learn if your state has any product defect laws that apply to your situation.

I realize what I am about to write will not be helpful to you now, but for the benefit of other readers, always have a mechanic of your choosing inspect a used vehicle before buying. (Here a mechanic would have detected the bad clutch immediately.) Run a Carfax report to learn if it's a flood vehicle, on a salvage title, or had its odometer tampered with. The more you know about a vehicle before you buy it, the less likely you will be surprised later.
Fred D.
Simi Valley, CA  |  December 09, 2013
Just bought a 2013 Ford F250. The salesman was advised of my fifth wheel's 14,000-lbs weight and its 2,500 lb king-pin weight (that's the trailer weight in the bed ). The door payload sticker only allows 1,928 lbs. The truck with fifth-wheel weighs 10,920 -- that's 920 lbs over GVW without anyone in the truck. I am only asking for them to buy back or swap the truck for an F350. Truck tows great but is nowhere near legal. Salesman was misleading. E-mailed 5 other dealers and 4 said F250 would pull it fine (have e-mails). Do I have any recourse?
December 10, 2013
Start by contacting the agency that deals with Consumer Complaints in your state. It is often part of the State Attorney General's office.
Bridget A.
Dallas, TX  |  November 22, 2013
I took possession of a used car not 24 hours ago and absolutely hate it. When I picked it up, after signing the papers, the tint had been removed and there were two major in-paint scratches that were not previously there when I agreed to the purchase. I've identified another vehicle with the same dealer that I want to purchase instead. What are my options?
November 22, 2013
If what you are saying is the seller harmed the condition of the car you purchased between the time when you inspected it and took delivery of it, then you did not buy the car you thought you were buying. Return it immediately, explain what changed, and that you want to trade it for a different car on the lot. Only a foolish dealer would turn you away unhappy in the situation you described.
Sarah M.
Oxnard, CA  |  October 14, 2013
I signed a contract on a new car a week ago. I had decided to go with a loan through my bank and had been told by my bank that all I needed to do was tell the dealer who my bank is and the dealer would know to fax them the signed sales contract and then I could return with the car to the bank and sign the loan. Well I let the dealership know I was going with them and they seemed upset and tried to push their financing again. I said no and by that time it was past bank hours and I would have to return Monday. I emailed Monday to confirm I was set to go and pick up the vehicle and the dealer texted me saying "yes." Once I got to the dealer they said they were unable to get ahold of my bank (it was a holiday) and when I became upset that this was my third trip they once again tried to push that I financed through them so I could take the car. I am mainly upset that they have lied to get me back into the dealer without providing me a car and just to try and push financing. I have given no sort of payment and do not have possession of the vehicle. Is there any way out of this I would prefer to give me business to someone not playing games.
October 16, 2013
The answer to your question can be found in the contract you signed. Review the contract. Do you or the dealer have the right to cancel the contract before you accept delivery of the vehicle? Out of curiosity, what does the contract say if you are unable to qualify for financing?

If the contract's language is impenetrable and unclear, take it to a lawyer in your state who has consumer law experience. He or she will tell you in minutes what the consequences may be for canceling the contract.
Paramount, CA  |  September 20, 2013
I purchased a brand new vehicle one week ago. Monday, I got a call that they want me to sign a SSA-89 form. I called the SSA being that my information was stolen a few months ago and that startled me not knowing what has been done with my identity. SSA advised me not fill out any forms and that if my identity needed to be verified I could get a letter stating that that was me from their office. I learned through the financing manager that my Social Security number has been used four different times so that scared me even more. So I called SSA again being that the dealer has been pressuring me for a week straight and trying to make me sign this form after I've said I wasn't being that SSA advised me not to. I might have to apply for a new number. What can I do as far as the car loan? I offered to return it. And they just ignore my requests and keep pressuring me into signing this form I'm not comfortable signing.
September 23, 2013
There are several mysterious facts you shared in your message. Let's start with what we know. A Social Security Administration Authorization for the Social Security Administration (SSA) To Release Social Security Number (SSN) Verification (SSA-89) (PDF) is a fairly harmless form, as far as I can tell. An SSA-89 asks the Social Security Administration to verify that a name matches a Social Security number. It's used by creditors and employers to make sure the applicant is using the proper Social Security number. A completed and signed SSA-89 does not release any other information, or authorize anyone to access the applicant's account.

The first mystery is how your automobile finance manager would know your identity was stolen a few months ago. My guess is the automobile finance manager is being pressured by the bank financing the loan to verify that you are who you say you are for some reason.

The second mystery is why your local Social Security Administration office is recommending you not complete a SSA-89 for the lender. As I mentioned, this is a fairly routine request, and a completed SSA-89 does not expose you to any risks I can see.

I feel there may be some missed or misunderstood communications here. Here's your safest course of action: Consult with a lawyer of your choosing today who has experience in consumer law. Bring him or her the copy of your automobile bill of sale and loan contract. Ask him or her to call the finance manager and hear the story of why the lender wants the SSA-89. Then ask the lawyer to call the Social Security Administration and ask them to explain why completing a SSA-89 is a bad idea in this situation. Act according to your lawyer's recommendation.

Your next course of action is to learn if you are an identity theft victim. Read the identity theft article to learn how you can tell if you are an identity theft victim, and the steps you can take to recover from identity theft.
Ann A.
Morgan, TX  |  June 10, 2012
We purchased a vehicle from a popular dealer here in Dallas and the internet price and price the salesman us was $11500. Upon looking on the paperwork today the price is $11988. Also we were told we had to buy gap insurance for $510 and in the contract it says we can cancel within 30 days. Then the finance manager told us that we had to buy a warranty agreement so the bank would finance us. That was $2500 and it is for Ford products. We did not buy a Ford product. Help in my mind we are paying $3498 more for the vehicle. We gave them a check for $2000 that they said they would hold until we could get the money out of my husbands 401-k. We love the vehicle but do not want to pay all these extra charges. We feel line we have been misled. What can we do?
June 12, 2012
Your story reminds me of the car dealer in the movie "Fargo" who tried to push the useless product Trucoat on his new-car customers. A mandatory extended warranty is Trucoat-like gimmick.

Stop payment on the check immediately. Explain to the dealer you reviewed the contract, and believe it contains unfair, undisclosed fees for product that provide no benefit to you. Then find another dealer that will honor its offered prices, and will not pack your deal with flim-flam.
Evelyn R.
Frankfort, KY  |  April 20, 2012
My husband and I bought a jeep today. Online it was listed at one price (we have this document). We got home and was looking through the paperwork and realized they charged us $1500 more then what was on the internet. Husband said when he was signing the contract the salesman had his arm over the price showing him where to sign and he thought nothing of it. Is there anything we can do?
April 23, 2012
Go back and talk to the dealer. You described a form of bait-and-switch, which is not allowed by most states laws. If the dealer does not refund the $1,500 or rescind the deal, then talk your state attorney general's office, and a private lawyer.
Trisha A.
Yorktown, VA  |  April 19, 2012
I bought a used BMW June 2011 the bill of sale says the car was black sapphire metallic. The day I bought the car, it was new on the lot and had not been washed so I did not get a good look at the paint, it appaeared to be black at the time. Long story short, my car is navy blue but I always thought the color was black sapphire metallic like the bill of sale says. I checked under the hood of my car today and the color is "Monaco Blue" NOT black. Is there anything I can do about this? The dealership sold me a car that they claimed was black and is not.
April 19, 2012
Unlikely, in my opinion, if at the time of purchase you thought the car was black, and the dealer also mistakenly thought the color was black. In common law this is known as a "common mistake" problem where both the buyer and seller share the same mistaken idea about the condition or status of the item bought and sold. The question is whether the common mistake is material or significant. If, when you bought the car, you told the dealer you wanted to enter it into a "most black car" competition, or had an uncontrollable compulsion to buy only black items and would be inconsolable if your car was anything but black, then you have an argument to reverse the sale. If, on the other hand, you just think black cars are cool looking and always wanted one, or only a trained observer could tell the color is a shade off from black, then you may not have much of a case. Consult with a lawyer in your state who has consumer law experience to get a more precise opinion.
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