A security deposit is often required by car dealerships as a safety net in case a buyer backs out of a sale or declines to make payments. Once the vehicle's purchase has been secured, the car dealership will often refund the security deposit, however, there are cases in which a dealership is within its right to refuse to refund you the deposit. Especially if you are paying your deposit in cash, it is important to know how to ensure that you will be refunded.
Paying a security deposit with cash can seem dangerous, but there are legal precautions that can help you ensure your cash is returned to you. First, read any contract before signing it. Some dealerships will add a non-refundable security deposit clause, in which case you will not receive a refund. If there is uncertainty in the contract that you will receive a refund, ask for that to be clear in writing. Because cash is untraceable, also get it in writing that you paid with cash. Ask your dealer for a copy of the contract in case he later denies you your cash deposit. If the dealership unlawfully refuses to repay your cash deposit, contact your state or local consumer protection agency for guidance and file a complaint with the Better Business Bureau. Finally, contact a lawyer if you are unable to resolve this dispute with your dealer.
