Chances are, if you financed your car through RDM Auto Sales, they had you to sign a "contingent delivery agreement" or "spot delivery agreement" or "bailment agreement" or some similar nonsense sounding document that was not explained and/or you did not understand. Spot delivery means delivery today, now, on the spot. RDM Auto Sales practically forces a car on you, and insists that you take the car home today. But they are not going to let you drive on the road until, buried in the paperwork, you sign their spot delivery agreement saying that if and when they call, you will come back with the car.
What do these "agreements" mean? Typically, they contain words to the effect that if RDM Auto Sales is not able to sell your financing contract to a lender on terms acceptable to RDM Auto Sales, then RDM Auto Sales gets to call off the deal and force you to return the car, and pay for the mileage you put on it. Plain English Translation: the bank did not offer them as much money as they wanted for the contract, and they have changed their mind. But wasn't it a done deal, you ask? The short answer is YES, but not in RDM Auto Sales's mind. But first, Did you know: usually when the bank takes the "assignment" of the contract, RDM Auto Sales gets money back from the bank? This is because the interest rate on the "buy rate" that the bank pays for the financing contract is far less than the "sell rate" the interest rate RDM Auto Sales gave you. The yield spread is often as much as 2% percentage points or more. Well, if you thought RDM Auto Sales was shopping the banks to get you the best deal on financing, you would be wrong. They are often shopping to see which bank will give them the biggest payback.
Of course, the "spot delivery agreement" just creates the opening for RDM Auto Sales to ask for more money. For example, they might say: "Your financing was not approved. We need you to either give us another $1,000 as a down payment, or else you are going to have to turn the car in." Or, they will say: "The financing fell through. We need you to come in and sign another contract." They pull you back into RDM Auto Sales office almost as fast as they threw you out in that new car that they insisted that you drive off the lot today in the "Spot Delivery."
But wait, you would say (didn't you already have a deal?) Not so, says RDM Auto Sales — they changed their mind. Well, do you think that YOU, the consumer, could change your mind? Do you think you could just call them up and say: "I think I paid too much for this car, so either you will have to give me $1,000 back, or else I am bringing the car in and unwinding the deal?" Well, faster than you can say "Yo-Yo Sale" they would remind you that right on the face of the contract it says that there is NO COOLING OFF PERIOD.
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