Cooling-off period for used car purchases |
Ian needed a used car. He worked out that he could afford $12 500 plus whatever he could get from his trade-in. Ian spoken to his accountant and knew he wouldn´t need a loan if he stuck to his budget.
Ian visited some dealerships and found that he could get a $3600 trade-in, giving him $16 100 to spend on a used car.
At one dealership, Ian found a car he liked but the purchase price was $18 000. The salesman said that, at such a ´low price´, the car would sell within days. Ian was tired of looking at cars and agreed to pay $18 000.
Ian signed the paperwork and paid a $500 deposit. He left his trade-in car at the dealership for a final inspection and got a lift home with his brother. After speaking with his brother, Ian realised that he should not have agreed to a contract he could not afford.
What can Ian do to get out of the contract?
All purchase contracts for used cars have a cooling-off period of one business day. Ian can give the dealership written notice that he is cancelling the contract.
He must cancel before the dealership closes on their next business day. The dealership can keep up to $100 of Ian´s deposit, but they must return the rest of Ian´s money and his trade-in vehicle immediately.
That evening, Ian wrote a letter to the dealership saying he was cancelling the contract. He dropped it off in person the next day. The dealership returned $400 of his deposit and his car.
Find out more about the cooling-off period.
Last reviewed 30/11/2011 |
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