# Need Help on Canceling Car Contract with Dealer



## ndthuw (Nov 14, 2012)

Hi,

We signed a contract to sell our car to a dealer then we realized that we can sell it with higher price and wanted to cancel the contract 3 days later. But there is a penalty of $5,000 (was stated in the contract) and they agreed to drop to $3,000 after we asked a lower penalty, no more. I think we signed a contract totally in favor for the buyer/dealer, which means as the contract, they should give us a deposit in case they can't do the agreement, deposit is non-refundable. However, they didn't give us anything. And when we want to cancel the contract, we have to pay penalty, although they dropped down the number, I think it's still high.

Is there any loophole that I can ask for a lower penalty? Or am I asking too much?

Please advise.

Thank you.


----------



## civicblade (Aug 27, 2012)

Read what is on the sales agreement/contract that you have signed. The terms on the sales agreement/contract is binding under the law. 

If the contract says the penalty is $5000, then the dealer can sue you for $5000 in a court in Singapore and will likely win. That means you have to pay $5000 plus some of the dealer's legal fees.. not a happy ending for you. 

If there is nothing on the contract that says anything about a fixed penalty, then you can negotiate with the car dealer on how to void the contract and the agreeable terms. If you void the contract on your own end with out the written agreement from the dealer then be prepared to rough it out in the courts if the dealer decides to pursue further. But they are unlikely to want to pursue the damages in court because it is not easy putting a figure to the potential loss of revenue due to you backing out of the contract and the legal fees may be borne by both side depending on the judge's decision. 

The best way out is either to go ahead with the sale of your car or negotiate an amicable solution with the car dealer. It is all up to you. 

The above advice are based on my feeble knowledge of contract law from my university days (non-law degree). Take it with a pinch of salt and seek professional legal advice. 



ndthuw said:


> Hi,
> 
> We signed a contract to sell our car to a dealer then we realized that we can sell it with higher price and wanted to cancel the contract 3 days later. But there is a penalty of $5,000 (was stated in the contract) and they agreed to drop to $3,000 after we asked a lower penalty, no more. I think we signed a contract totally in favor for the buyer/dealer, which means as the contract, they should give us a deposit in case they can't do the agreement, deposit is non-refundable. However, they didn't give us anything. And when we want to cancel the contract, we have to pay penalty, although they dropped down the number, I think it's still high.
> 
> ...


----------



## wesmant (Feb 10, 2012)

i actually am wonder what sort of contract u sign when u want to sell ur car.

When I sell my car, I just talk about how much I want to sell, the dealer got to give me down-payment, and he must settle my loan balance and do the ownership transfer for me. 

I won't sign anything until I see the money coming over to my hand.


----------



## pichuya (Mar 14, 2013)

Its more like a service agreement between the buyer and the seller. The seller (car dealer) do states all the terms and conditions in a agreement when buying a used car. You may wish to check your documents carefully before proceeding with any decision.


----------



## jam1 (Mar 14, 2013)

May I ask what is the price difference the dealer has offered versus the higher price?

My opinion is you should get rid of the car ASAP if you have decided to, even if you think the dealer offered you lower price. With the recent measures on 40% (or 50%?) cash down payment on purchase of vehicles, it may be difficult to find buyers on your own or any dealers who are willing to take in vehicles.



ndthuw said:


> Hi,
> 
> We signed a contract to sell our car to a dealer then we realized that we can sell it with higher price and wanted to cancel the contract 3 days later. But there is a penalty of $5,000 (was stated in the contract) and they agreed to drop to $3,000 after we asked a lower penalty, no more. I think we signed a contract totally in favor for the buyer/dealer, which means as the contract, they should give us a deposit in case they can't do the agreement, deposit is non-refundable. However, they didn't give us anything. And when we want to cancel the contract, we have to pay penalty, although they dropped down the number, I think it's still high.
> 
> ...


----------

