Legal Question in Consumer Law in Maryland

The dealer and I signed a contract. There are no special delivery clauses I signed, and nothing that I sign states it's pending a 3rd party approval. The seller and creditor on the contract is the dealership. I disclosed my income and explained it to the best of my ability to the salesperson as he input into the credit app. It was the salesperson who figured my income at $3k/mo. I don't disagree, although the check stubs he used to figure that, didn't display that;they displayed more like 2600/mo. Still, the dealer wrote the contract and was comfy with it, as the bank gave them an okay. Yet when the bank crunched the numbers the next day, they didn't like it, and rejected the loan. The dealer wants the car back. What should I do. I put down 1500 and I have a recent Chp 7 discharge.. and no car if I give it back.. don't I have a legally binding contract with the dealer?

Asked on 3/01/18, 6:06 pm

1 Answer from Attorneys

Cedulie Laumann Arden Law Firm, LLC

In essence, most contracts are "if I pay $x, you'll give me Y" If you cannot pay $x because you can't get a loan, then it would almost certainly breach the contract and the other side doesn't need to give you Y.

People shopping for a car are generally free to either pay cash or get whatever financing they want (it doesn't need to be from the dealer's contact). So practically someone could go to their own bank or credit union to get a loan if rejected by the dealer's preferred lender. However, at the end of the day, if a buyer cannot come up with the purchase price it would be highly unlikely that a seller would be forced to give them a car or house or whatever the contract called for, instead, both parties would go back to the position they would have been in without the contract (so the deposit returned to the buyer, the item returned to the seller).

This post offers general information and should not take the place of getting directed legal advice if you face a contract dispute.

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Answered on 3/02/18, 6:26 am

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