Automotive

Dealer of used car wanting me to sign and pay deposit

  • Last Updated:
  • May 1st, 2019 9:55 am
[OP]
Newbie
Dec 7, 2014
54 posts
16 upvotes
Ottawa, ON

Dealer of used car wanting me to sign and pay deposit

I was asked to sign a contract and pay a deposit of $1000 on a used car from a Mazda dealership. I said I was not ready then left the dealership and came back to sign once we agreed on a price. I said I would buy the car conditional on a pre-purchase inspection from my own independent mechanic. I am worried now that I signed a deposit which is actually the full contract. While I indicated that it was conditional on a pre purchase inspection, what happens if the inspection find problems, damage or flaws? Am I out of luck? Realize I should have been more careful. Read here: (http://www.cbc.ca/news/canada/edmonton/ ... -1.3112713) that I should run away if asked to pay deposit.
14 replies
Deal Fanatic
Apr 5, 2016
5331 posts
3799 upvotes
Calgary/Vancouver
Asking for deposit is standard procedure and I don't really see an issue for it. However, every car I bought or helped bought, the deposit was always refundable and I made sure of it in writing.

In your case, if the dealer wasn't a dick you'll most likely get your deposit back if there was issues with the inspection. If you wanted to be completely safe, you should've noted what constitutes as unsatisfactory like engine problems or brake failures. But I wouldn't worry about it.
Deal Expert
User avatar
Feb 11, 2007
16502 posts
18059 upvotes
Oakville
What's the point of a deposit if it's fully refundable? Just to show some intent of seriousness?
If the women don't find you handsome, they should at least find you handy.
Deal Guru
User avatar
Oct 6, 2010
14859 posts
9254 upvotes
Toronto
engineered wrote: What's the point of a deposit if it's fully refundable? Just to show some intent of seriousness?
Bingo, AND a bargaining chip if the buyer tries to back out. The dealer will attempt either one of two options: keep your deposit or get rich by getting you to get the car. Lots of folks still don't understand the car buying process.
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Member
Aug 18, 2017
269 posts
157 upvotes
As long as you have a copy with a written condition of a 'subject to' you'll be fine.


If you do decide to cancel just make sure the reason is because of the 3rd party inspection not that you found a better deal elsewhere or some other reason that'll agitate them.
Deal Addict
Sep 12, 2017
1894 posts
186 upvotes
NathanT039266 wrote: If you do decide to cancel just make sure the reason is because of the 3rd party inspection not that you found a better deal elsewhere or some other reason that'll agitate them.
1. When putting down a deposit where would you specify in writing that the deposit is conditional on satisfactory pre-purchase inspection? What else should you add in the conditional deposit??Does it say anywhere specifically in a car contract that the deposit is refundable?

2. What's the minimum deposit on a listed $19K car?
Banned
Apr 5, 2013
5810 posts
2970 upvotes
keenland
it just blows my mind....there has to be about 10000 pages of what to do and what not to do when buying a car in this forum....yet every week, there is someone new, posting about their own eff up....just goes to show lack of "street smarts" among the general population of this community ...even with advice written countless times in these threads...people refuse to follow, and create their own predicaments...unbelievable at times
Deal Expert
Jan 15, 2006
16405 posts
14516 upvotes
Richmond Hill
cardguy wrote: it just blows my mind....there has to be about 10000 pages of what to do and what not to do when buying a car in this forum....yet every week, there is someone new, posting about their own eff up....just goes to show lack of "street smarts" among the general population of this community ...even with advice written countless times in these threads...people refuse to follow, and create their own predicaments...unbelievable at times
Which is why I can’t even bother responding to such threads anymore lol

But I keep coming back for the entertainment.
Member
Aug 18, 2017
269 posts
157 upvotes
reggyDeal wrote: 1. When putting down a deposit where would you specify in writing that the deposit is conditional on satisfactory pre-purchase inspection? What else should you add in the conditional deposit??Does it say anywhere specifically in a car contract that the deposit is refundable?

2. What's the minimum deposit on a listed $19K car?
Every offer to purchase is different - most say deposit is non refundable unless specified. You would want a proper offer with the details of the car, all in price, payments and any terms to the deal. On the paper you would just write deposit subject to satisfactory pre-purchase inspection and then get a copy of it. There is no set minimum for the deposit, for something like this the less is better for you. Realistically they'd probably want $500.


If the dealer seems sketchy or maybe they have bad reviews of withholding deposits in the past... I'd just book an inspection and tell the dealer you'll put down a deposit once the inspection has been completed to your satisfaction.
Deal Addict
Sep 12, 2017
1894 posts
186 upvotes
NathanT039266 wrote: On the paper you would just write deposit subject to satisfactory pre-purchase inspection and then get a copy of it.
Does it matter how it's written out, since it is a legal document? Would it be better to write "Deposit return subjected to satisfactory pre-purchase inspection"?
NathanT039266 wrote:
If the dealer seems sketchy or maybe they have bad reviews of withholding deposits in the past... I'd just book an inspection and tell the dealer you'll put down a deposit once the inspection has been completed to your satisfaction.
So the dealer would just let you borrow the used car from their lot, and you'd just drive down to a mechanic to have it inspected. Which would probably take around an hour or so. Seems if the car is not in the lot, they can potentially loose a sale if someone else is comes in to look at the car. Just a newb to the process.
Sr. Member
Aug 4, 2004
512 posts
271 upvotes
If it is the case that you want to buy the car from the dealership and want to bring it out for inspection at your own mechanic, I understand why the dealer wants you to sign and put down deposit. But it should be after you guys come to a price first.

Imagine everyone just go in dealership and take used car for a spin or over the weekend instead getting a rental, it will become dealership loss. They also lose another potential customer who may want to look at the car while you bring it out for inspection.

As long as you both make it clear that it is refundable if inspection report is not satisfy.. like rusting.. previous non-disclosed accident...etc
Deal Addict
User avatar
Jun 10, 2011
2053 posts
555 upvotes
Woodbridge
OP look for another dealer. Unless you're buying a super rare Bugatti to pay a deposit prior to test driving and PPI is completely useless. The dealer knows very well that if you decide not to complete the sale by having your deposit they have you by the balls and will try very hard before refunding to get you into another car.
This is a very well known tactic that dishonest stealerships employ and some people fall for it.
Banned
Aug 3, 2005
1235 posts
1166 upvotes
Deposit on used cars LOL...

Dealer tried that on me once...told him "no deposit, not even $1.... I will buy it off you in 1-2 weeks when I am ready"

Of course I go back after 3 weeks, its still available and I even knocked an additional $700 off.

Also, dont pay an BS "dealer fees.
Deal Addict
Nov 18, 2015
1146 posts
1508 upvotes
Waterloo, ON
cardguy wrote: it just blows my mind....there has to be about 10000 pages of what to do and what not to do when buying a car in this forum....yet every week, there is someone new, posting about their own eff up....just goes to show lack of "street smarts" among the general population of this community ...even with advice written countless times in these threads...people refuse to follow, and create their own predicaments...unbelievable at times
Honestly, if a mod could sticky certain post such as
"Checklist for used cars"
"Checklist for new cars"

It would've been a lot easier for people who ain't in this forum every other day...
Deal Addict
Sep 12, 2017
1894 posts
186 upvotes
cellsell wrote: As long as you both make it clear that it is refundable if inspection report is not satisfy.. like rusting.. previous non-disclosed accident...etc
Upon mechanic inspection do you have to agree what constitutes a dissatisfactory inspection? I assume every Honda dealer ship would pre-inspect a used car before a sale. But if they have missed something, would something as uneven tire wear constitute a dissatisfactory inspection, or an uneven fender or hood lines, potentially indicating a previous accident?

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