Distance selling - right to a full refund

[nocturne_sa]

Hi folks

I bought a used car today over the phone from a dealership based over 400 miles away. They haven't yet sent me a contract to sign. I paid a deposit over the phone using my credit card and also settled the remaining balance via bank transfer.

I'm now having buyers remorse (won't go into those details but no fault of the dealership). Am I right in thinking that given this is a distance contract, I am entitled to all of my money back including the deposit? As I mentioned, I have signed no paper work which states that the deposit is non-refundable. I have not signed or received any paperwork.

They originally said it will take them a few days to get the car ready and this was meant to be delivered to me rather than collection in person. I have already emailed the dealership requesting cancellation to ensure they don't spend any money prepping the car.

Thoughts/advice would be very welcome.

Much appreciated.

[Wilmslowboy]

Yes, you can cancel, did they ask you to waive your distance selling rights (although in reality they can't, and it makes little difference)

See here https://www.theaa.com/car-buying/legal-rights

It's in everyone's interest to act quickly and inform them ASAP, that you don't want to proceed.

[nocturne_sa]

Wilmslowboy said:

Yes, you can cancel, did they ask you to waive your distance selling rights (although in reality they can't, and it makes little difference)

See here https://www.theaa.com/car-buying/legal-rights

It's in everyone's interest to act quickly and inform them ASAP, that you don't want to proceed.

Thanks for the prompt response. No they didn't mention anything about waiving distance selling rights. I have already emailed and text them so its only been about 5 hours between paying the deposit and cancelling the car.

Am i also likely to get my deposit back? Or can they argue that they have already incurred costs prepping the car? There was outstanding finance on the car so I'm worried they will argue that this has been settled so they have already incurred significant costs.

Thanks

[stevemcs]

Outstanding finance or dealer stocking ..... either way it makes no difference to you.

[tinnitusjosh]

We all hate car dealers, but would it be the worst thing in the world if they kept £100 or so of the deposit to put towards their reasonably incurred costs? Not doubting that its your prerogative to do so, but you did just change you mind on a whim and there's a chance that this could cost them real money

[ElectricPics]

tinnitusjosh said:

We all hate car dealers, but would it be the worst thing in the world if they kept £100 or so of the deposit to put towards their reasonably incurred costs? Not doubting that its your prerogative to do so, but you did just change you mind on a whim and there's a chance that this could cost them real money

As a business, you either accept the responsibilities and risks of distance selling, or don't do it. Occasionally you'll take a hit that leaves a bad taste.

[tinnitusjosh]

ElectricPics said:

tinnitusjosh said:

We all hate car dealers, but would it be the worst thing in the world if they kept £100 or so of the deposit to put towards their reasonably incurred costs? Not doubting that its your prerogative to do so, but you did just change you mind on a whim and there's a chance that this could cost them real money

As a business, you either accept the responsibilities and risks of distance selling, or don't do it. Occasionally you'll take a hit that leaves a bad taste.

Yep, I get all of that, I just wonder how far I would be prepared to push it if I was in OP's position

[eybic]

It's highly unlikely that they can keep your deposit, especially if you haven't signed anything. I used to work in a dealership and when pushed, we always refunded deposits as we had no right to keep them.

[PAULJ5555]

If they start getting funny e-mail/fax/post them a copy of the regs. This has worked for me before - not for a car.

[catman]

They offered you a car and you paid for it. That in itself is a contract. It doesn't change the distance selling regulations, just that some people get hung up on whether or not any papers have been signed.

Tim

[nocturne_sa]

Quick update - they have agreed to refund the full amount but have told me that their bank’s fraud prevention team need to clear the original transaction first and funds won’t be available to be transferred back until this is done. The dealer then proceeded to request a copy of my passport, drivers licence and bank statements. All very weird as I’ve never had to go through this before. I was initially a bit hesitant sharing these details but did so in the end.

I just hope I don’t end up getting scammed. To be on the safe side I’ve already notified my bank who have put a trace on the funds transferred to the dealership.

[ElectricPics]

nocturne_sa said:

...have told me that their bank’s fraud prevention team need to clear the original transaction first

This has the whiff of bullst. Faster payments and BACS are cleared no later than on the day of transaction - usually from instantly to two hours - and can't be reversed. Car dealers will have large sums of money transferred into their accounts several times a day so I doubt they'd want their bank constantly holding up cleared funds.

[anonymous-user]

Sounds like money laundering protection procedure.

[Digger]

Why not call your bank & inform them, also asking them whether procedures are being correctly followed?

[essayer]

RogerDodger said:

Sounds like money laundering protection procedure.

Absolutely, their bank will probably be very suspicious of your intentions as most people don’t do what you are doing, and it will flag up their money laundering/know your customer type procedures.

I suspect once they forward your paperwork on, it will all be resolved rapidly.

[Alucidnation]

And several credit cards and agreements set up.

[ElectricPics]

essayer said:

Absolutely, their bank will probably be very suspicious of your intentions as most people don’t do what you are doing, and it will flag up their money laundering/know your customer type procedures.

I suspect once they forward your paperwork on, it will all be resolved rapidly.

Why would a bank be suspicious of someone paying thousands of pounds into a car dealer's account via a traceable electronic fund transfer. The same account likely receives hundreds of similar payments every year. Know Your Customer? It's a car dealer, not a financial institution.

[Wooda80]

ElectricPics said:

Why would a bank be suspicious of someone paying thousands of pounds into a car dealer's account via a traceable electronic fund transfer. The same account likely receives hundreds of similar payments every year. Know Your Customer? It's a car dealer, not a financial institution.

It won't be the dealer's bank that is delaying the refund, it will be a very nervous line manager within the garage anxious not to be the one that authorises a refund of a payment that could later be reversed ( such as Western Union or some Paypal payments ) leaving their business out of pocket.

Whatever the OP's genuine reasons, the reversal of the transaction after paying such a large amount is unusual and therefore attracts suspicion.

As for Know Your Customer, dealers have obligations under these regulations when arranging finance. This appears to be a cash transaction, but there is also a moral obligation on the dealer to verify the customer's identity otherwise less scrupulous characters would have their cars invoiced and registered to Mickey or Minnie Mouse at 10 Downing Street and zoom off into the untraceable sunset.

[nocturne_sa]

Quick update guys. Turns out it was the dealer who flagged this to their bank as they had a similar situation last year which turned out to be fraudulent. A bit surprising as I was asking them to refund the money back to the account it was sent from.

The good thing is that I had put in a payment trace last night through my bank which has now made contact with the dealer’s bank. The money will be refunded through the banking channel rather than the dealer sending it back to me. I don’t mind as long as I get the money back and soon!

The dealer has separately refunded the deposit back to my credit card.

[essayer]

I would be very surprised if a car dealer was not registered with the FCA.

An ‘unusual transaction’ like this should always warrant further checks and due diligence.