Private party auto loan deposit

[Bedwards]

Jurisdiction

Louisiana

I took a $1,000 deposit to hold a vehicle so the buyer had time to get financing in place. There wasn't any contract signed, it was simply a verbal agreement that the deposit would ensure the vehicle was hers and I told her I would take it off of the market and hold it for her. Apparently her financing fell through and she is having trouble getting the money. I have text snowing she asked me to hold it, that the deposit was to do so, but nothing that states it was non refundable. Do I have to legally return this deposit? I met we twice, once for a test drive and once to get the check and the car was "sold" for three days before she wanted to back out.

 

[txls]

Give her the money back.

 

[Brandonedwards]

Thats not an answer to the question, do I legally have to

Give her the money back.

not an answer.

 

[adjusterjack]

Please understand that you had a contract, an oral contract, which is just as enforceable as a written contract.

From a legal standpoint there are two ways to look at this.

1 - If you posit that the contract was contingent on her getting financing then the sale was cancelled when she failed to get financing and you owe her the deposit.

2 - If you posit that the contract was not contingent on her getting financing then she breached the contract by not completing the purchase and you'd be entitled to compensation for what the breach costs you.

The way that works is you hold the $1000 until you sell the car to somebody else. You are legally obligated to make reasonable attempts to sell the car for the same price as you sold it to her. If you sell it for the same price with no other costs then you've been made whole and you owe her the $1000 because contract law doesn't allow you to profit from another parties breach.

If you are compelled to sell for less than her agreed price due to any number of justifiable reasons then all or part of her deposit goes to make up the difference and you owe her what's left of the deposit (if any).

I've explained the legalities to you so now it's your choice as to how you want to handle it.

Frankly, I suggest you just give her the money back and next time you get a prospective buyer don't do anything stupid like taking deposits and holding the car off the market.

My advice: Somebody wants to buy your car, they bring the full price in cash. Until then the car is still on the market and gets sold to the first person that shows up with the cash.

That's how I've been doing it for over 40 years and never had this kind of problem in the years since the foolish days of my youth when I learned from my similar mistake or two.