Dealer deposits can be tricky

One of the top pieces of car loan advice is that once a buyer has settled on a car is to wait. On the lot, a salesman is always going to attempt to pressure a customer into a quick decision, and this is where dealers can make a lot of their money.

In the vast majority of cases, there’s no need to act quickly. Dealers have hundreds of cars on their lot, but salesmen will almost always tell a buyer that the car they’re looking at is the last one they have and may even mention other buyers interested in it. Don’t buy it. Even if that’s the case, there are plenty of other car dealerships that most likely have the model in question. It pays to take some quotes from the dealer, think it over, crunch some numbers with a car payment calculator and head back ready to negotiate.

An offshoot of this is the deposit. Many dealerships will say that the car in question is one of the last models available, but they’ll hold it if a driver puts a deposit down. At some dealers, these are glorified surcharges. According to cars.com, unless the dealer puts in writing that the deposit is refundable, it isn’t. Many buyers have put down hundreds only to never see that money again once they return.

There are a few cases where a deposit could be legitimate. Models that are expected to quickly sell out may require a deposit, like the upcoming Chevy Volt or Nissan Leaf. Another case is if the buyer is ordering a custom-configured car directly from the factory. If the dealership is going through the trouble of ordering the vehicle, they’re entitled to a deposit to make sure the buyer doesn’t change their mind and the dealer is stuck with a vehicle they don’t want.