Can you put a deposit on a car to hold it?

Some car dealers ask for deposits; others don’t. It’s up to individual car dealers to decide whether to promise to hold on to cars in exchange for deposits.

Some car dealers will request a deposit and promise, in return, to hold on to the car for a certain period of time. Others will request a deposit but make no guarantees, other than to return the deposit if they end up selling the car to someone else. Depending on the dealer, the deposit you pay may go towards the purchase price for the car, or it may be solely to hold the car.

A holding deposit is different to a purchase deposit. A holding deposit is often a small sum paid to the seller to ensure they don’t sell the car to someone else before you’ve had a chance to give it a test drive and make your own offer. A purchase deposit is paid when you commit to buy a car.

Different states and territories around Australia may have different rules and regulations regarding how much a dealer or private seller can ask for a deposit on a car. Also, in some states and territories around Australia, a cooling-off period may apply. If you change your mind before this period expires, you should be able to get back any deposit you’ve paid.

If you need to organise a car loan to buy a car, you may want to check that the contract says that completing the purchase is conditional on you obtaining the loan. If you can’t get a car loan after reasonable attempts, you may be able to cancel the contract and have the deposit returned to you.

Whether you’re buying a car through a dealer or a private seller, it’s often worth getting the terms and conditions of a car holding deposit in writing, as well as a receipt for the deposit. You may also want to check that any contracts are fully completed before you sign, without any blank spaces. Getting everything in writing in advance means you should be able to proceed with the transaction confidently, and without worrying about unexpected surprises.

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