Tips on Buying Cars: cancelling a used car contract before taking ownership, toyota camry 2007, cooling off periods

Question
Hello Steve,

I have a question regarding the topic of cancelling a use car contract:

I just signed a contract over the weekend (Saturday afternoon) to purchase a used car (Toyota Camry 2007) from a local dealer. I put down a deposit of $500, and was set on completing the payment for the car (cash) and taking ownership on Monday night (Sept. 29 2008). When I ran a "CarFax" report later on Saturday evening, I realized that the car was a "rental" which was acquired at an auction. This threw red flags in my mind, and I would like to back out of this deal (I know, I should have ran the CarFax report before signing anything, you are right!!).

What are my options here? Is the contract legally binding that the dealer can force me to take ownership, or do I still have some life since I have not completed the payment for the car and drove off the lot with it? Can I just tell the dealer "I am not interested anymore and that I have changed my mind"? I know there are no "cooling-off" periods for used cars, but I want to know my options!

If you can get back to me ASAP (I know you must have many like these), then I would greatly appreciate it.

Thanks so much,

Sam.

Answer
hi sam,
first, i believe the contract is binding, based on it being a rental, you cannot get out of the contract, you can try asking the dealer if would consider letting you out of the deal because he did not disclose it was a rental. On a positive note, rentals are not always bad, they are maintained very well because of the heavier use. If he will not let you out of the deal ask him if you can take the car to your mechanic for an inspection. If the car has some manufacturers warranty left i would go back to toyota, and have them check it out.....please let me know if you have any other questions and good luck


steve