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  • avatar colin_l 03/17/10 4:17 pm PST

    Aha. Now I understand.

    Some states have truth-in-lending laws that require you to sign a sales contract that shows the total payment amount.

    When your interest rate changes, the total payment of course changes. That means in my home state, I'd have to sign a new document at whatever the higher rate is. If I decline, the contract is voided.

    However I would then have to pay a rental fee for my use of the vehicle. For an average used car this might be $100 - $200. Cheaper than a bad loan for sure.

Answers

  • karjunkie 03/17/10 8:53 am PST

    The time to ask these questions is BEFORE you sign a contract. At this stage you have to do whatever the CONTRACT says. Read it carefully to see what your options are. Once you drive it off the lot, it is a used car and the dealer has zero incentive in taking it back, so don't expect them to do so easily. Most likely, the contract is subject to financing but the dealer will eventually get you approved for a really bad loan. So, if I were you, try to get a good loan and don't play games as it will only cost you more money in the end.

  • jmarescotto 03/17/10 10:06 am PST

    In reality the contract you signed (if you got the financing through the dealer) would be null and void if the dealer does not have you approved 100%. Which means they won't get the money from the finance company for your financed deal. And check the date on your contract...if the date is before the approval date and you never had any other financing for that car from any other source..then your "contract" will mean nothing at all. And unless you have the thousands of dollars to pay cash for the vehicle...return it and fight..if necessary get a lawyer involved...most dealers (specially small ones) don't want to even take the time to fight it..they'll take the car back and re-sale it and make their money.

  • knowledgepower 03/17/10 1:10 pm PST

    The dealer has to take the vehicle back even now. You are on what is called spot delivery, they spot you the vehicle until the loan is approved. You should have signed a bailment agreement in the finance office that states when the dealer can't get approved financing they have the right to get the vehicle back. You also have the right to take it back. You can just drop it off and hand them the keys. Don't listen to any discussion about you signing a contract,there is no contract until the deal is funded. You can actually call the bank and tell them you don't want the vehicle, they may send you to another dealer that they do business with if you are not happy.

  • colin_l 03/17/10 1:29 pm PST

    But read the original post carefully..

    He hasn't been declineed yet. It appears that he's considering not doing the phone interview or at least wondering what would happen if he is declined.


    If you can't get a loan at all, sale will be voided. It happens.

    If you try to escape the contract by improperly applying for loans, the dealership will be all over you and something bad will eventually happen.

  • karjunkie 03/17/10 1:51 pm PST

    Right Colin! Exactly the point I was trying to make. Trying to walk away after you made a deal by not cooperating on the financing is walking on thin ice IMHO

  • peterp718 03/17/10 4:08 pm PST

    Dont get me wrong im not trying to do anything wrong to get the loan declined or anything like that. The sales person did increase my salary a bit on the form. I was just going to tell the truth of how much I make.
    My question was if this bank declines the loan would I be forced to sign with another bank beacuse the interest might be much higher. Im over paying for this car as it is I dont want to pay more in interest.
    By the way this is a used car not a new one. I like the car but im discusted from the dealership and their misleading practices.

    Peter

  • colin_l 03/17/10 4:17 pm PST

    Aha. Now I understand.

    Some states have truth-in-lending laws that require you to sign a sales contract that shows the total payment amount.

    When your interest rate changes, the total payment of course changes. That means in my home state, I'd have to sign a new document at whatever the higher rate is. If I decline, the contract is voided.

    However I would then have to pay a rental fee for my use of the vehicle. For an average used car this might be $100 - $200. Cheaper than a bad loan for sure.

  • peterp718 03/17/10 4:39 pm PST

    Do you have any experience on the laws of New York. This is driving me mad not knowing what to do. Thanks.
    Peter

  • colin_l 03/17/10 4:50 pm PST

    I think you're getting ahead of yourself a bit. Do the phone interview and see what happens. If they approve the loan, you are on the hook. Do not provide inaccurate information or behave strangely in an attempt to get the loan denied.

    You did sign a contract and what you have is mainly buyer's remorse. I've felt that too, but you have to learn and move on.

  • peterp718 03/17/10 5:12 pm PST

    what I want to tell the bank is about the 6000 extra in warranties that the dealer said that the bank needed them on the contract in order for the bank to approve the loan. Which was a lie since I called the bank and they said they never asked or require such warranties. When I confronted the financial guy about the lie he said Its to late you signed the contract. That is what I want to tell the bank.

  • colin_l 03/17/10 5:18 pm PST

    You can cancel extended warranties at any time and get their value returned, pro-rated. In this case it would go to the bank because you would have a loan on it.

    So if all you're concerned about is BS extended warranties, you can rest easy.

  • peterp718 03/17/10 5:26 pm PST

    do i tell the bank about those warranties? I told the car dealership and they refuse to take them out. They said is too late. Whats your advice?

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