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Why is this car dealer keeping a $10,000 deposit? Financing fails but man can't get money back

Posted at 5:00 AM, Jun 16, 2021
and last updated 2021-06-16 09:57:13-04

CHANDLER, AZ — Buying a car can be an exciting experience -- or in the case of one Valley man, it could be a four-month struggle over a deal gone bad.

James Morris put $10,000 down on a used car and ended up not getting the car or his money back.

He signed a contract for a 2016 Chevy Suburban sold by Ditat Deus Automotive in Chandler.

"They were going to get the financing, they got me pre-approved," James says.

James gave the dealership a $10,000 down payment and was able to drive away with the SUV while he waited for word of the final financing.

Taking possession of a car even though the financing and the deal are not complete is called spot delivery. It is legal in Arizona. But as you'll see in this case, it's a risky move for buyers.

Nine days after James put down his $10,000 and took the car, he says everything changed.

"I saw the salesman and the owner pull up. The owner hopped in and they drove away," he says.

James says without any prior notice, the dealer took the Suburban from his parking lot.

"So, I called him and he's like well the financing didn't go through so we're taking it to protect our assets," he says.

And what about James' asset -- that $10,000 deposit?

He says he went to the dealership three times and still couldn't get his money.

"They wouldn't give me a straight answer. There's no legal reason why they should hold the money. There were no damages. I put on less than 400 miles," James says.

He says he tried taking the dealer to court but found he signed an arbitration agreement that doesn't allow it.

By this time, James had enough and let me know.

He says the dealership never gave him any explanation about why they kept the money.

We couldn't get an answer either.

Instead, we were told James needed to give them permission to talk about his situation.

We gave the dealer James' phone number and email address and James waited for their contact.

It didn't come.

And James says when he called the dealership to give permission, they didn't want to talk to him.

When we couldn't get answers by phone or email, we went to Ditat Deus in Chandler.

The man inside the dealership is the man James says sold him the Suburban.

I again asked for some reason they would keep James' money.

He told me the owner was gone and no one would talk about it. He asked us to leave and says he was calling the police.

We left and waited on a nearby sidewalk hoping if the police did come, we could show them the contract and what was happening to James.

The $10,000 deposit is written right in that contract. The dealership did not deny receiving it.

Despite our repeated attempts to find out a reason for them keeping it after taking the car back, we received no answers.

We didn't see police or the Suburban on the lot.

An online car history search shows a title change in April and registration in May.

Was the Suburban sold to someone else?

"They've never called me or nothing," James says.

Now he waits without a car and without the money that he could really use right now.

"I just had some health problems so I'm not working," James says.

Before buying a car, check for arbitration clauses.

If you sign, any issues are handled by an arbitrator, and you lose some protections you may have in court.

Also, don't drive a car home unless it is fully financed, and the deal is completely done.

We'll keep working to get James' money.

Learn more about spot delivery and rules about buying a car.

Have you had a similar issue with this or any other dealer? Let me know by emailing joe@abc15.com.