cabiex Posted February 11, 2016 Share Posted February 11, 2016 We have paid a 10% deposit on a new motorhome from a dealer but have now changed our minds and no longer want to proceed with the purchase. The sale agreement states that the deposit is not returnable if we do not go ahead the the purchase. Is this the case legally or can we get a partial or full refund? Link to comment Share on other sites More sharing options...
Brock Posted February 11, 2016 Share Posted February 11, 2016 My understanding is that both parties have entered into a contract so both parties must honour their part unless the other has defaulted, or misrepresented the deal, or the conditions can be deemed unfair. If you have simply changed your mind, then expect the dealer to enforce the contract and accept you have lost the deposit. When in doubt, seek professional advice because it will hang on the exact terms of the sale agreement and how you were persuaded to sign it. I have heard of one case where the dealer was able to sell the van again and thus it graciously agreed to refund the deposit less its costs. In this case, the reason for the purchase pulling out was exceptional. Link to comment Share on other sites More sharing options...
Tall_Mike Posted February 11, 2016 Share Posted February 11, 2016 As above - When we bought our van there was a fair period between taking placing our order (the dealer had the van) but we needed to wait for probate to come through to fund the purchase. We knew we wanted to proceed and could put down about 25% of the cost right away. It was made very clear to us - before a penny changed hands that a certain amount - about 7% - was non-refundable, thus after we had lodged the first payment, - a certain proportion would not be returned to us, if we had to pull out for any reason although the remainder of the deposit would - Perhaps the probate didn't arrive or simply we changed our minds, - To be honest it didn't seem unfair, we had committed at that point but no pressure was brought to bare, - it was entirely our call to proceed and the facts laid out. Link to comment Share on other sites More sharing options...
Rayjsj Posted February 11, 2016 Share Posted February 11, 2016 I'm afraid you have probably lost your deposit, a change of mind is not really a valid reason for backing out of a contract. Sorry . Mind you 10% on a new Van will be quite a lot of money, was it a special order ? or did the dealer have it in stock ? Normally if the van is in stock, a 1000 pound deposit will hold it. But if a special order, then the dealer will have to find someone who wants your requirements. Not always easy. So 10% is a reasonable deposit in such a case. An expensive change of mind. Link to comment Share on other sites More sharing options...
Derek Uzzell Posted February 12, 2016 Share Posted February 12, 2016 The following article may be worth reading: http://www.thecarexpert.co.uk/bought-a-car-and-changed-my-mind/ Vehicle purchase orders can have very large sharp teeth and before committing to the purchase it’s important to read the order-document carefully and to appreciate the implications. A buyer wishing to cancel the order (and there may be a very good reason for this like a family crisis or a sudden major health problem, not merely a change of mind) may find that it’s not just the deposit that’s at risk. If, say, a £1000 deposit were asked on a new motorhome that needed to be ordered/built and the overall cost were £50,000, if the motorhome has been bullt and the buyer changes his/her mind, simply witholding the deposit could leave the motorhome dealer well out of pocket if the vehicle subsequently proves hard to sell. If that happens (and the purchase order covers that situation) the dealer will be legally entitled to seek from the buyer the difference between the profit the dealer would have made selling the motorhome to the buyer at the agreed £50,000 price and the price (say £45,000) that the motohome eventually fetches. So not only would the buyer then lose the £1000 deposit, but he/she would be liable for a further £4000. Link to comment Share on other sites More sharing options...
StuartO Posted February 12, 2016 Share Posted February 12, 2016 If you changed your mind about buying a motorhome at all, it should console you that losing your 10% deposit will be less expensive than the depreciation you would have incurred the moment you collected the MH and took it on the road, not to mention the money you would have also probably spent on accessories etc. Link to comment Share on other sites More sharing options...
Tea Cup Posted February 12, 2016 Share Posted February 12, 2016 It is really quite an amazing coincidence that we are about to put a deposit on a new van today. This doesn't change our minds but it is good to know where we stand. Thanks. It shows how useful these forums are. Link to comment Share on other sites More sharing options...
Dr Dave Posted February 12, 2016 Share Posted February 12, 2016 To be honest a non refundable deposit is just that. You knew this and signed the agreement. I don't expect the fact you changed your mind will help the dealer at all who could have possibly either ordered the van for you, or missed out on a potential sale whilst holding the van for you. Link to comment Share on other sites More sharing options...
lennyhb Posted February 12, 2016 Share Posted February 12, 2016 I think the dealer is within his rights to keep the deposit although a reputable one would probably give most of it back especially if you may be buying another van in the future. 10% seem very high, we have brought 2 new vans and the deposit on both has been less than 2%, first one it was €1000, 2nd one €1500. Link to comment Share on other sites More sharing options...
Billggski Posted February 12, 2016 Share Posted February 12, 2016 Have you told them? If not check the delivery date is on schedule, if it has slipped, and most do, you could stand a chance of cancelling the order. Good luck. Link to comment Share on other sites More sharing options...
mikejkay Posted February 12, 2016 Share Posted February 12, 2016 Derek Uzzell - 2016-02-12 9:12 AM The following article may be worth reading: http://www.thecarexpert.co.uk/bought-a-car-and-changed-my-mind/ Vehicle purchase orders can have very large sharp teeth and before committing to the purchase it’s important to read the order-document carefully and to appreciate the implications. A buyer wishing to cancel the order (and there may be a very good reason for this like a family crisis or a sudden major health problem, not merely a change of mind) may find that it’s not just the deposit that’s at risk. If, say, a £1000 deposit were asked on a new motorhome that needed to be ordered/built and the overall cost were £50,000, if the motorhome has been bullt and the buyer changes his/her mind, simply witholding the deposit could leave the motorhome dealer well out of pocket if the vehicle subsequently proves hard to sell. If that happens (and the purchase order covers that situation) the dealer will be legally entitled to seek from the buyer the difference between the profit the dealer would have made selling the motorhome to the buyer at the agreed £50,000 price and the price (say £45,000) that the motohome eventually fetches. So not only would the buyer then lose the £1000 deposit, but he/she would be liable for a further £4000. Surely it would only be the loss of profit that the original purchaser would be liable for? Not the difference in the selling prices. Link to comment Share on other sites More sharing options...
Derek Uzzell Posted February 12, 2016 Share Posted February 12, 2016 mikejkay - 2016-02-12 2:22 PM Surely it would only be the loss of profit that the original purchaser would be liable for? Not the difference in the selling prices. Yes - if the dealer could make, say, £8k profit on a £50k motorhome and then has to sell it for £45k, the dealer will have ‘lost’ £5k of the anticipated £8k profit and the buyer could be sued for that £5k. The example I gave was purely hypothetical and merely to illustrate that a motorhome buyer reneging on the deal might lose a lot more than just the deposit. Link to comment Share on other sites More sharing options...
HymerVan Posted February 12, 2016 Share Posted February 12, 2016 Whilst it is definitely correct that a dealer could sue for loss of profit there are hurdles in the way for a dealer wishing to do so because the computation of the loss of profit is complicated and would involve giving sensitive information about margins etc. Furthermore since compensation for loss of profit is not taxable it is loss after tax that is relevant.These complications make it less likely (but certainly not impossible) that a dealer will persevere with a claim for loss of profit. It is precisely for these reasons that a significant deposit is taken. In some jurisdictions the dealer may as an alternative be entitled to insist on performance of the contract i.e. can force the purchaser to complete the purchase but I don't know if that applies in England. Link to comment Share on other sites More sharing options...
gocro Posted February 12, 2016 Share Posted February 12, 2016 We were in a similar situation , but had a good reason to cancel, after spending £500 on legal costs we still lost the lot.. Bear up , it's gone. Link to comment Share on other sites More sharing options...
ron. Posted February 12, 2016 Share Posted February 12, 2016 One important lesson here is not to pay a 10% deposit, or anything like it. We paid £1000 on our last two vans costing £54,000 and £58,000 from different dealers. The first had quite a lot of requested extras and also an 8% discount on the retail price. If a dealer won't play ball another will. Ron Link to comment Share on other sites More sharing options...
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