Special thanks to my customer Michael Sleeman, who inspired me to write this post and even film a video on the topic (me on camera is always a huge blow to my self-esteem, but you gotta do what you gotta do)!
In September of 2020, I did a couple of free mileage + auction grade checks by VIN number for someone in Sydney. They had quite a limited budget (for what they wanted) and couldn’t find a good import on the money.
(Nothing new. Good quality is never cheap and free cheese is in the mouse trap.)
Long story short, they realized they won’t be able to find anything good at the local car yards and asked me to import by custom order for them.
Sure. On a $500 refundable deposit.
It took us over 2 months, countless emails, phone calls, Viber messages, over 100 bids and IMMESURABLE HOURS of work for us and our team in Japan to finally get what they wanted.
Arrival was scheduled end November - early December, but that ship got cancelled due to COVID disruptions. New ETA - early January 2021.
And this is when I get these text messages about their “unexpected expenses” and “bad timing”:
So, let’s have a look when a fully refundable deposit is actually refundable and when it’s not.
There are 3 common scenarios when you're placing a deposit.
1. You've already seen a car and you've organised a 3rd party mechanical inspection to make sure everything is hunky dory:
✅ DEPOSIT IS FULLY REFUNDABLE if inspection finds a hidden fault such as mechanical or electrical issues or substantial rust underneath (surface rust is normal on any second-hand vehicle over 5 years old)
⛔ DEPOSIT IS NOT REFUNDABLE if you change your mind, lose your interest, move on to another car, your partner’s cat throws a tantrum, “some unexpected expenses have come up”, etc. It's also non-refundable if a dealer is happy to rectify the faults at their expense.
2. You haven't seen the car before placing a deposit. You might come yourself to view and test drive a car or send an inspection:
✅ DEPOSIT IS FULLY REFUNDABLE if upon arrival you find any mechanical or electrical issue or substantial rust underneath (see above) and/or if there is an unpleasant smell in the cabin (smoking or animal or mouldy odour) or there are multiple dents or scratches you weren't aware of. You have more reasons to get your deposit back since you've placed a deposit in good faith, without seeing a vehicle.
⛔ DEPOSIT IS NOT REFUNDABLE if you change your mind, lose your interest, move on to another car or project, and if your second half wants a Range Rover Sport. Unexpected expenses don’t count either. It's also non-refundable if a dealer is happy to rectify the faults at their expense.
3. You are buying a car by custom order from Japan.
A dealer is looking for a vehicle with certain criteria to suit YOUR taste and budget in Japan. They're going to spend multiple hours of sifting through gazillion vehicles, checking selected ones, liaising with the team in Japan and with you to make sure they're getting the right one before bidding on your behalf.
✅ DEPOSIT IS FULLY REFUNDABLE if a vehicle arrives and it doesn't correspond to the brief/description, if it has any mechanical or electrical issues or substantial rust underneath and also if there's unpleasant smell in the cabin (smoking or animal or mouldy odour) or if there are multiple dents or scratches you weren't aware of.
⛔ DEPOSIT IS NOT REFUNDABLE if you change your mind, lose your interest (job, driving license, etc.) move on to another car or decide to renovate the kitchen/build a sauna/fly to the space instead.
It's also NON-REFUNDABLE in case if “unexpected expenses have come up” and you suddenly decide you have a deadline (and bring it up after a deposit is placed and after a vehicle is purchased for you).
It's definitely NON-REFUNDABLE if there's a deadline in the contract, however shipments from Japan are cancelled due to a force majeure such as tsunami, pandemics or something else of equal intensity.
If you follow me, that person had absolutely no right to ask for their $500 back: I was informed about their ideal due date AFTER we purchased and shipped the car.
Yet, I transferred without a blink because I was stunned, and because I didn’t have time and patience to deal with them in the end of 2020.
You know what? I won’t do it again. 😊
P.S. Hope you find this info useful. You never know, it might save you from a filthy dealership, trying to steal your money, or from an unnecessary embarrassment.
P.P.S. Someone asked me the other day if a missing plastic in a cabin was enough to get a deposit back.
I’d recommend using common sense.
If you’re buying a fairly new and expensive vehicle, the expectations are high, and the cabin should be immaculate.
If you’re buying a 10 or 15-year-old vehicle, then a piece of missing plastic in the cabin (as well as a few scratches) is totally acceptable and isn’t enough to get your deposit back, especially if everything else is in perfect working order.
Just buy that missing bit online or from the wreckers. Good bones are so much more important, aren’t they?
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