Deposit for private car sale?

[Cooked Rice]

I'm curious what precautions should be considered by accepting a deposit for a car you are selling privately? Someone wants to offer me a deposit for up to half the amount of what I'm selling the vehicle for to hold it up to 2 weeks. Is there a contract of sorts that should be used? Payments methods? Thanks!

[MR2-3SGTE]

Accepting a deposit isn't really too risky...leaving the deposit is. Just get it all in writing, and cash is king. have in writing the amount, how long you're holding it for, and what will happen with the money if the buyer backs out.

[firebane]

Originally posted by Cooked Rice
I'm curious what precautions should be considered by accepting a deposit for a car you are selling privately? Someone wants to offer me a deposit for up to half the amount of what I'm selling the vehicle for to hold it up to 2 weeks. Is there a contract of sorts that should be used? Payments methods? Thanks!

For 2 weeks? Not a chance would I be doing that.

If the person can't pay within the first day or the second day you walk.

2 weeks is a long time and you could have another buyer come a long and pay for it completely at once.

[whydontchathen]

Originally posted by firebane


2 weeks is a long time and you could have another buyer come a long and pay for it completely at once.

2 weeks is a long time for anything to happen in the buyer's life which could preclude him paying the debt. Complications, delays, false promises. You'd putting yourself at his mercy for TWO WEEKS in hopes that he comes thru on his commitment.

Why take such a chance with a total stranger?

[Sugarphreak]

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[Unknown303]

Or you tell him you'll take the deposit but if he doesn't pay in full in 2 weeks you keep the deposit. Then if he flakes you get some extra cash and can go back to selling for the same amount anyways.

[Tik-Tok]

Originally posted by Unknown303
Or you tell him you'll take the deposit but if he doesn't pay in full in 2 weeks you keep the deposit.

That's kind of the point of a deposit isn't it? lol.

In a perfect world I would accept it as non-refundable (documented and signed), but in reality knowing how stupid people are out there, I wouldn't chance it. He might agree now, but then try and back out and pull some shitty stuff later.

[300zxfairlday]

I would be all over taking the deposit! And hoping he cant come up with the rest of the money within 2 weeks! Win Win situation for you. As long as you write up a proper contract.

[Seth1968]

Originally posted by Tik-Tok
In a perfect world I would accept it as non-refundable (documented and signed), but in reality knowing how stupid people are out there, I wouldn't chance it. He might agree now, but then try and back out and pull some shitty stuff later.

Exactly.

So after 2 weeks he doesn't pay and you've got a bunch of extra cash. How cool is that?

Except...he's a nut case and your nightmare begins.

[GQBalla]

same, i would accept that deposit for sure. Have a contract that states clearly and have the buyer sign that this deposit is non refundable and that it is agreed that you will receive the rest on X date. Add whatever you want for after the X date

me personally though, ive always paid in full or left a deposit and agreed that i will come in max 3 days depending if it was the weekend to get my insurance or registration.

[Sugarphreak]

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[mr2mike]

The number of people that think a deposit on a vehicle is refundable is crazy. Make sure he/she knows.

[ExtraSlow]

Last time I accepted a deposit, it was for $6000 on an $8300 vehicle. I offered to hold it until 8:00 PM on the next banking day.

I really don't like deposits, and I haven't left one for a vehicle in years. I did once go shopping for a vehicle with nine grand in cash in my jacket, so I'd be ready to buy at a moments notice. That felt weird.

[FraserB]

Originally posted by mr2mike
The number of people that think a deposit on a vehicle is refundable is crazy. Make sure he/she knows.

You do realize that there is no specific language on refundable versus non-refundable aside from a guideline for consumers to determine which it is before giving one right?

[lilmira]

Preferably not, if the buyer is ready to buy then buy it, if not, come back later. When I told a girl last time that deposit means you ARE buying the car and therefore it's not refundable, she gave me the deer in the headlights look lol. Ya come back when you are ready.

[G-ZUS]

I don't mind deposits, what I don't trust is payment plans on a private sale.:rofl: If someone was offering full asking price (which is rare on kijiji lol) for the car and was willing to leave a deposit for a week or 2 - I wouldnt mind holding it if I didn't need the cash right away. It really depends on the person though.

I once offered a guy $100 deposit on a 2k car for 15 min while I drive down the street to get the rest of the cash from the bank. He told me not to waste his time, prick. :dunno:

[DeleriousZ]

I generally do the deposit thing in 2 ways. 1st is if the car is out of province or a long distance from me, I'll put down a $2-500 non-refundable deposit with a written contract/receipt. 2nd is if I'm looking at a car and I decide I want it, I'll do the same thing and usually take the full amount out of the bank the next day.

[Kloubek]

I'm going to guess the 2 weeks is when his next paycheque comes in.

I do agree with what has been said here, but I've done deposits before and think it is a viable way of doing business. Here's how I would go about doing this:

1) Make the deposit small. Something that would be worthwhile for compensation if you had to turn away other prospective buyers, but not so much that you feel bad for the guy if he loses it. Maybe 5% value of the car?

2) Write a contract stating that the deposit is forfeited and the car will be back up for sale if he does not come through with XXXX remainder by XX date. (And when "back up for sale", it would probably be nice to let him buy it if he can come up with the rest of the cash before someone else does)

3) Have both parties sign it, preferably with a witness.

And make sure the deposit is cash only. Just limits complications of him stopping a cheque, etc.

[ExtraSlow]

Good point, never take any deposit that isn't cash.

[mr2mike]

Originally posted by FraserB


You do realize that there is no specific language on refundable versus non-refundable aside from a guideline for consumers to determine which it is before giving one right?

Didn't know this. I was sort of basing this more off wedding photog deposits. Know people that are photog's and the amount of people who a month before the wedding say, I found someone else, can I have my deposit back is crazy... the date is hard to fill for the photog so it's a non-refundable deposit.

I usually take something low like others say... 5% or 10%. Enough that they're serious and not enough that you'll get the hassling phone calls for months if deal falls through.

When I was 16 and sold my first car, the guy was really convincing that I had to save the car for him over the weekend. I was dumb and did it. Deal went nowhere.

[clem24]

Yeah agreed with everything here... The point of a deposit is that it is only refundable in certain circumstances, usually that the car doesn't pass safety or something to do with the car not being as advertised after an inspection. Otherwise what is the point of a deposit if it's refundable? Getting approved for financing is usually NOT a condition in a private sale, but can be in a commercial setting.

It's just hilarious how most people don't understand the point of a deposit (i.e. it's commitment to buy, not simply to hold the car).

[whydontchathen]

Originally posted by clem24

It's just hilarious how most people don't understand the point of a deposit (i.e. it's commitment to buy, not simply to hold the car).

Well a deposit on a purchase can certainly be for holding purposes only, it just depends on what the two parties agree to. I can't count how many times I've left deposits to hold items (not cars though) and 99% of the time I've followed through on the sale.

Except for last night, when the $300 item I'd left a $90 deposit on four days earlier did not fit my vehicle like we both expected it would. Thankfully for me the seller refunded the full amount, yes it was a Kijiji transaction, lol. Nice guy, didn't try to keep the deposit, although the terms of the deposit were not discussed in advance. I guess in future I should have that discussion re the terms of the deposit....

[sputnik]

I gave a seller a $400 deposit for a $6500 winter beater once.

It was Sunday and the banks weren't open late.

Left the cash, got him to write up a bill of sale noting the cash left and remaining owing and I took a picture of his drivers license.

I would never leave more than 10% as a deposit and never for more than a couple of days.

[MalibuStacy]

I had to give a deposit to the guy I bought my HHR from... he held it for a week while I got a bank check and sold my old Malibu. Also being that I was in Calgary and without a set of wheels, I had to wait till the weekend to get a ride to pick up the car from his farm near fort McLeod. Everything was written.

Rule of thumb have copies of everything which has been written down, and keep your receipts.

[BokCh0y]

I personally wouldn't accept a deposit in upwards of half or more just to "hold" the car for a couple weeks. Maybe up to 10% for a few days just to wait for the buyer to secure the funds if required is the most, and that's a nice courtesy on your part. Cash is king, first come first served. That's how I would approach it like others here have said. Tell him if he has the money in 2 weeks and you still have the car, it's theirs if they still want it.

I've been through this bs with people trying to leave a deposit for a week or 2. The number of potential buyers could be 0 or 100 that you miss out on. And if the buyer backs out after you passed up some buyers...what are you gonna do?

Just move on to the next potential buyer but keep this guy in mind for 2 weeks down the road.

[ercchry]

Originally posted by BokCh0y


And if the buyer backs out after you passed up some buyers...what are you gonna do?


um... what would i do? hrm... laugh all the way to the bank on my 50% return in two weeks :nut:

[Seth1968]

Originally posted by ercchry


um... what would i do? hrm... laugh all the way to the bank on my 50% return in two weeks :nut:

:facepalm:

[ercchry]

Originally posted by Seth1968


:facepalm:

1/2 money down... either car is sold... or you just made an extra 50% if he doesnt show up, since the car is still worth the same in two weeks as it is today, why is this so hard to understand?

[Seth1968]

Originally posted by ercchry


1/2 money down... either car is sold... or you just made an extra 50% if he doesnt show up, since the car is still worth the same in two weeks as it is today, why is this so hard to understand?

Do you actually think that math is the only variable in such a transaction?

Read the thread.

[ercchry]

Originally posted by Seth1968


Do you actually think that math is the only variable in such a transaction?

Read the thread.

yeah, really... it is... you are taking a chance on having to hold the car longer for the chance at a bonus 50%. no one is saying that you cant keep showing the car to potential buyers during that time either. you ever sell a house? same concept, bigger scale

[clem24]

Originally posted by ercchry


yeah, really... it is... you are taking a chance on having to hold the car longer for the chance at a bonus 50%. no one is saying that you cant keep showing the car to potential buyers during that time either. you ever sell a house? same concept, bigger scale

Absolutely agreed. I was easily take that deposit, in writing, stating that it will only be refunded if the car doesn't pass safety, not as advertised, if something happens to the car during the 2 weeks, etc...

Problem is, I don't think this is the buyer's intention..

[Seth1968]

Originally posted by ercchry


um... what would i do? hrm... laugh all the way to the bank on my 50% return in two weeks :nut:



Originally posted by ercchry


1/2 money down... either car is sold... or you just made an extra 50% if he doesnt show up, since the car is still worth the same in two weeks as it is today, why is this so hard to understand?



Originally posted by ercchry


yeah, really... it is... you are taking a chance on having to hold the car longer for the chance at a bonus 50%. no one is saying that you cant keep showing the car to potential buyers during that time either. you ever sell a house? same concept, bigger scale



Originally posted by clem24


Absolutely agreed. I was easily take that deposit, in writing, stating that it will only be refunded if the car doesn't pass safety, not as advertised, if something happens to the car during the 2 weeks, etc...

Problem is, I don't think this is the buyer's intention..

That other variable I spoke of which you two seem to be forgetting? People FFS.

Someone who probably is financially strapped, has to pay the rent on his next pay cheque, backs out of the deal, and then expects his deposit back.

You then say, "Fuck you. I'm keeping the deposit", and wake up to slashed tires and a, "No, fuck you" keying.

Think of the worst thing that could happen. If you can't handle that, then don't do it.

[ercchry]

do you also think of the worse thing that can happen when you get on a plane? get out of bed in the morning? walk across the street? travel on the highway? visit another country? go deep sea fishing?

[Unknown303]

Originally posted by Seth1968


That other variable I spoke of which you two seem to be forgetting? People FFS.

Someone who probably is financially strapped, has to pay the rent on his next pay cheque, backs out of the deal, and then expects his deposit back.

You then say, "Fuck you. I'm keeping the deposit", and wake up to slashed tires and a, "No, fuck you" keying.

Think of the worst thing that could happen. If you can't handle that, then don't do it.

Which is why you make it really damn clear to the person in the first place what will happen if they decide not to buy.

[whydontchathen]

Originally posted by ercchry
do you also think of the worse thing that can happen when you get on a plane? get out of bed in the morning? walk across the street? travel on the highway? visit another country? go deep sea fishing?

Did you give a passing thought to what if the shoe was on the other foot? If you were the buyer, how would you feel if someone just pocketed $500 of your money and you got dick all?

Or to put it another way: is money in your pocket more important than the monumental despair you are bringing down onto another person?

[Unknown303]

Originally posted by whydontchathen

is money in your pocket more important than the monumental despair you are bringing down onto another person?

In this scenario yes.

[ercchry]

Originally posted by whydontchathen


Did you give a passing thought to what if the shoe was on the other foot? If you were the buyer, how would you feel if someone just pocketed $500 of your money and you got dick all?

Or to put it another way: is money in your pocket more important than the monumental despair you are bringing down onto another person?

i would be completely aware of the non-refundable status of said deposit and IF i had to do such a thing i would make damn sure to have access to the funds by the date in question. but then again i've taken much larger risks with money than $500 and idgaf :bigpimp:

business is business, thats it. there is nothing unethical about this so i would sleep just fine. you cant fix stupid and im not about to try

it would be like a casino giving back the bet cause the guy betting it gambled away his pay cheque. not their problem.

[Kanto_Terrors]

I've personally experienced this. This 20 something kid wired me $500 to hold the car for him, but a week later he backed out of the deal. I didn't really have any interests on the car, so I wired him 50% of his money back.

Just have everything on writing just in case. 2 weeks is a long time especially if you get a lot of interests on the vehicle.

[Sugarphreak]

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[FraserB]

Yeah, I'd love have an extra thousand or so on top of my asking price. But I don't think I'd be able to feel good about it since most of the time the guy who gives a small deposit until next pay, then backs out NEEDS that money.

I've done the “deposit” thing once and it was clear that it was a commitment to purchase contingent on financing and would be deducted from the purchase price or refunded.

[hampstor]

If you have an upfront discussion about the expectations around the deposit, I don't see why it couldn't work. The worst thing is if you both have 'covert contracts' where you are expecting the other party to do something without actually telling the other party. ie: he expects you to hold the car for 2 weeks and you give the money back if he can't buy it.

My recommendation... have a discussion about what conditions he gets the money back, how much he gets back, and your expectations on keeping the money and how much. If you can come to an agreement, document it.

If you can't come to a simple agreement, then I wouldn't bother trying to sell him the car.

[ercchry]

Originally posted by Sugarphreak
First, Casinos are a disgusting plague on society... they survive entirely by preying on those with crippling gambling addictions and essentially rigging the odds in their favor. Not exactly something to aspire to.

okay fine, broker taking a commission on a losing stock...


Originally posted by Sugarphreak

Second, there will always be somebody out there who takes advantage of the weak or naïve car buyer; scum bag salesmen, trailer trash assholes, con artists, EZcarsandTruck.com, curbers… etc.

You can justify it as “just a business deal” all you want, but you are basically lowering yourself to that level by engaging in it. I’d sooner have my morals than some poor kids 500$.

So ask yourself... are you better than James Stewart?

difference being that this is a cut and dry contract, and those people use loopholes to purposely fuck their clients.

[Sugarphreak]

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[sidewaysD]

No i would not take a deposit..


:thumbsdow


Just think of the headaches if they back out of the deal.. Like Inriches Asian girlfriend. What a cluster fuck that was.

Fuck it.. last thing anyone needs is an "Advertisement" or bad publicity on how the "Seller" "screwed" a buyer (who backed out) out of a deposit.

No thanks..