My daughter bought a car, made down payment signed the legal bill of sale, had car registered, now the dealer?

this is a classic bait and switch....dont fall for it!

It's legal if the bank denied her loan. She needs to work directly with the dealership's finance and insurance manager to get this settled.

Often banks will approve someone for a loan based on their credit application...if they find that they put down '2 years' as the time they have lived in a house, when the real time is '2 months' they will deny the loan.

Dealer's sometimes even let people buy cars when they assume that the customer will be approved for a loan, but they later find out that the bank will not approve a loan and must take back the vehicle.

Most dealers can work with you somehow...even if it means financing the vehicle with a different bank.

If the bank has not approved the loan, then your daughter has not yet really registered the vehicle in her name - the dealership is holding the paperwork until the loan is finalized.

Work with the dealership to find her another bank to finance the vehicle and ensure that her interest rate does not go up.

Yes.

The dealer has a clause in the contract stating that all terms are contingent on lender approval. For the last 3 weeks, the finance manager has been working with lenders to try and get this deal bought by a bank. They make tons of calls, work with everyone they can to secure financing. If, after all of that, the financing is rejected, there is no optin but to unwind the deal. Apparently your daughter's residency did not meet the minimum requirements of any of the lenders.

This happens more now, with the credit crunch we are all seeing. Banks are tightening up on their requirements, and getting more and more conservative. I am seeing deals that were easy a year ago getting shot back now. Its not the fault of the dealer - believe me we WANT to sell the car. Just like you don't own it until a bank approves it, we have not sold it either. We get no comission, profit, or satisfaction from unwinding a deal.

You do have one other option. Go to roadloans.com, drivetime.com, eloan.com or lendingtree.com. Apply online and see if one of them will finance the car. If so, you can take the funding letter to the dealer, and its all handled. If not, I am afraid you have no option but to return the car.

EDIT - OK Armchair attorney - tell me how this is "bait and switch"? She is unable to get financed. They dealer cant sell the car, because they wont get paid. Where is the "switch"

Folks, as dealers, we review your credit application, terms of the deal, and credit report. Based on that, and our experience, we make an educated guess as to what the banks will approve, and write purchase agreements. the agreements state that the dealer will attempt to secure financing on your behalf. We are not banks. We are not lenders. We are the liason between you, and several banking institutions. My dealership is lined up with over 60 banks.

After the deal is signed, the Finance Manager goes to work. He can look at a deal and decide that it meets the criteria of certain lenders. So he contacts those lenders, sends them the deal, and awaits their response. If they approve it, you never hear from him again, and we are all happy.

If none of the lenders are able to approve it, he makes LOTS of phone calls. Working with a lender builds a relationship,a nd sometimes we can get them to reconsider loans. But, after all of that, sometimes it simply is not approved. It happens. Last month we wrote over 230 car deals. I had about 9 flat out turn downs we had to unwind.

Like I said before, banks are getting tighter. We work with them, and you, to try and keep you in the car.

What do we gain if we undo the deal? Dealer makes no profit. Salesman makes no comission. F&I Manager makes no comission. Service department loses a potential customer since you have no car. And we all have wasted a LOT of time. There is NO upside to the dealer when this happens.

Why in the world would you all think this is some underhanded tactic? What would we gain? nothing. Its not. People just love to villify the dealer when they don't get their way. Believe me, we are not getting our way either. We lose more than you do.

If anyone can think of ANY way we 'win' by unwinding your deal, I would love to hear it.

not really,they are using the residence law to do this with,to buy a new car the usually want a steady residence address,they really cant make her bring the car back as long as her credit passed,but their is a part of any contract that says they have the right to withdraw on any contract,its not fair to the buyer,though,but she can beat it,if she can make the payments they really cant say too much about it,ask a lawyer about it,they may know a way to get around this,i have seen this happen before,they fear they wont get paid for the vehicle,good luck.,,PS another thing i didn't add ,if they couldn't get her financed through any finance company or bank then the contract may not be any good and they can make her bring it back,they should also have to refund her down payment if they do this,but usually the wont give back any refunds,it bad way to sell a car,but they do it all the time,good luck.

Just FYI, it seems like a lot of people post here that they have this situation. What's going on is, the dealer wants to sell the loan to some bank, and the bank won't buy it. So the dealer is stuck with the loan, but they want money instead.

Now - do they have the right to force you? I have no idea.

No, that is not legal. They should have established that when she bought the car...everything is in her name now and the car is hers provided she makes the necessary payments. I was in the same situation when I got a lein against the car....they told me I would need to get full coverage, but I had already gotten the money. It was their fault for not checking my insurance coverage before they gave me the money. I make my payments on time and there is nothing they can do.

If she has the title, the car is hers. If she got the loan, then the terms of the loan are set according to what's written there, and it's too late to change them.

If it turns out that the loan is not approved, then arrangements will have to be made.

Never heard of such a thing. You should check with the Dept. of Motor Vehicles.

she needs to read the contract she signed to make sure there's no clause that he can take it back for a dumb reason because no that doesn't sound legal at all.

Sounds like it's a done deal and there should be no going back now.

I'm not sure where you are from...The first thing you should do is call your Attorney General's office. Have them handle the situation.