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Frequently Asked Legal Questions

Find answers to common questions in our searchable FAQ.


2374 views   |   49   |   Last updated on Oct 02, 2018    Consumer Protection Motor Vehicles

Many people believe they have a 3-day right to cancel the purchase of a new motor vehicle, but that is not the norm. Richard Alderman, a Texas attorney who helped draft the Texas Deceptive Trade Practices Act, addresses this issue on his website. In response to whether a person can return a new motorcycle, he states:

As a general rule, when you sign a contract to buy something you are bound by the terms of that contract. There is no time limit within which you may just “change your mind.” In most cases, to get out of a contract, you must show that you were induced into the contract by fraud, duress, deceit or misrepresentation. There are a few exceptions to this rule.

One exception is for motor vehicle retail installment sales. A retail installment contract is a “transaction between you and the dealer to purchase a vehicle where you agree to pay the dealer over time, paying both the value of the vehicle plus interest,” according to the Consumer Financial Protection Bureau. That is, a retail installment contract does not apply to transactions that involve a loan. Section 348.111 of the Finance Code states that a buyer may rescind the contract under certain conditions, quoted below:

Sec. 348.110. DELIVERY OF COPY OF CONTRACT. A retail seller shall:
(1) deliver to the retail buyer a copy of the retail installment contract as accepted by the retail seller; or
(2) mail to the retail buyer at the address shown on the retail installment contract a copy of the retail installment contract as accepted by the retail seller.

Sec. 348.111. BUYER'S RIGHT TO RESCIND CONTRACT. Until the retail seller complies with Section 348.110, a retail buyer who has not received delivery of the motor vehicle is entitled to:
(1) rescind the contract;
(2) receive a refund of all payments made under or in contemplation of the contract; and
(3) receive the return of all goods traded in to the retail seller under or in contemplation of the contract or, if those goods cannot be returned, to receive the value of those goods.

You may also want to review the terms of the contract or agreement that you signed as it may contain cancellation provisions, a return policy, or a “cooling-off period.” Generally speaking, once you sign a contract, you are bound by the terms it contains. There may be exceptions (e.g., a contract was signed under duress, there was deception or fraudulent activity), but only an attorney can provide a legal opinion and inform you of your options.

It may also be possible to negotiate with the seller and come to a mutual agreement.

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