Used car dealer wants check for full price of car to 'hold' vehicle

So this practice seems very odd to me which is why i pose the question.

I’m looking at a vehicle (about $20k). When i asked what i needed to do in order to make the car off limits for potential buyers until my auto-draft check arrived, here is the dealer’s response…
" What we would do is ask you to write a check for the full amount you plan on financing. We will not cash the check, but when you get the auto-draft check from your bank, come back and we will swap checks. Don’t worry, every dealer does this."

Now as i heard that, alarm bells started ringing right away.

Keep in mind, this is a used car dealership only, so they aren’t affiliated with any major manufacturer. Also, they are not a member of the Better Business Bureau.

Has anyone ever heard of something like this before?

Thanks for responses,

P.S. This is in suburbs of Atlanta GA.

When you write a check you are liable to produce the funds if the check is cashed, period. So, if your financing is rejected for any reason, you still have to honor your check. This is a legal “limbo” situation I would not put myself in. Say, “see you later” to this dealer.

Bullcrap. Run from this dealership. Don’t buy anything from them, ever.

I think I need more info to make a judgment call here. Forget the dollar amounts and think of another example. You walk into the grocery and put a gallon of milk on the counter. Would you ask the store to hold that gallon of milk off-limits from another shopper while you went home to get cash? Would you be willing to leave them a check for the milk while you went to get cash?

Well, it’s a slippery slope here. On one hand you don’t like the idea of the dealer having your personal check for $20,000. I don’t disagree. There’s absolutely nothing stopping them from going straight to the bank to cash it. You’re on the hook for $20K.

On the other hand, why would the dealer consider holding the car for you without being paid for it? What if 20 minutes after you leave someone walks in with their American Express Black card and wants to buy that car?

Did you sign a sales contract stating you are legally bound for the purchase of the car yet?

I can understand making a non-refundable deposit on a car–say $100 or so, but not $20,000.
I had the opposite experience back in 1973. I was visiting my wife’s relatives about 40 miles away and we were looking for a used car at the time. My wife spotted a car on the lot she thought we should investigate. The salesman flat out told us that the car was a piece of junk, but did have a car that was in the wash area being cleaned up. We saw the car, went on to visit the relatives and stopped back to test the car We agreed upon a price pending a good report from my mechanic. The dealer said he didn’t need a deposit to hold the car and let me drive it 50 miles back home to my mechanic. After a good report, I obtained a cashier’s check for the amount and proceeded back to the dealer. When I presented him with the check, the saleman said, “You didn’t need to get a cashier’s check, we would take a personal check”. I had never been to this dealership before and the price of the car in 1973 was $2000.

I was thinking i could call my bank and cancel the check number (before presented to dealer), but still write the check so that i can protect myself from his statement of ‘don’t worry we won’t cash it’

When someone tells me ‘everyone does it’ or ‘it’s normal practice’ i hesitate a lot as i feel i should.

I can deal with a 100 dollar non-refundable holding fee, but what’s to stop the dealer from saying the vehicle has sold and pocketing my check?

This vehicle doesn’t really seem ‘too good to be true’ per se, but it’s close.

Thanks for all of the input,


As an additional note to asemaster, i have only dealt with this dealer via phone, so i have not signed anything. Plan to browse the inventory in the next few days.

I also am someone that hesitates when asked to sign ANYTHING…even my name on a blank piece of paper to check my calligraphy lol

Are you saying you haven’t actually seen the car in person and driven it? You gotta look, see, feel, smell, and listen before you buy.

correct asemaster, i have only seen the vehicle online and spoken to the dealer via the phone.

I do understand that feeling/driving the vehicle is going to be my determining factor, but my main question was ‘is it normal for a reputable dealer to ask for a personal check written for the full price of the vehicle in order to hold the car until i get my auto-draft check from my bank’


I plan on checking out the vehicle in person in a few days…

You’re being pushed here, HARD. Don’t be in such a rush. Find 2 or 3 cars you like, then work to get a good deal, THEN sign a check. Never sign anything until you’re ready to commit.

I know a lot of used car dealers. I do not know ANY that would ask for a check for the full amount in order to hold a car. $100 seems to be the going rate for a one week hold. Of course if you don’t buy the car, don’t expect your $100 back. If I were you, I would RUN away from this guy as fast as I could.

It seems to me the dealer is trying to take advantage of your interest in the car. I think they want your signed check thinking that once you’ve gone that far you’re sure to buy the car. I’d advise against putting any money–even $100–as a deposit or hold on a car from a dealer.

Having said that, I think it’s unfair for you to ask them to make the car unavailable to any other buyer without you actually, finally, buying the car. Used cars are a first-come, first-served commodity. First one in the door with money in his hand gets the car.

I say this as a car nut and as someone who makes a living running an automotive service facility: “It’s just a car. If this one is gone there will be another one along in a little while.”

If the car is not there when you go to see it, there will be another comparable available. Offer $150 to hold the car if they demand something, refundable based on satisfactory inspection report if you really want that car.
If you find a good mechanic there may never be a satisfactory report because anything but a new car probably needs something done.
Please spend the dollars to have the car checked out by an independent mechanic prior to purchase.

Are we sure this is not a total scam, craigslist or such? Is this car priced too good to be true?

The car is coming from a usd car dealership. One scary thing is they have 24 filings against them with the better business bureau. Vehicle brand new MSRP is 29k. They are asking for 26k. It is a 2012 model with one owner and 41000 miles on it.

I know i should probably run away but cus of the BBB filings but the pruce does seem really good.

I do plan on seeing how i can get the vehicle to an independent mechanic for verification of quality.

This sounds like a lousy deal to me. New MSRP is $29 and you feel $26 is a good price with 41K miles?

How likely is it that the car actually sold at the MSRP price? Go to a dealer and see what a new car with -0- miles of the same model and options costs? The dealers might be ready to deal with 2013’s on the way. Forget MSRP, get the real selling price. Look at and get the true market value too. 41K miles in one year should take a good lump off the value.

Im sorry. Vehicle has 4100 and not 41k miles.

There are lots of cars out there.  If you don't buy that one, there will be lots of other cars out there.  You don't need to worry that the car you are looking like is the last of its kind.   The dealer would like you to think it is, but it's not so. 

 Frankly you have the advantage here.  If he sells a car he just buys another, for the next buyer. You are in a like position because if you don't buy that car, you can buy the next one.  

 The dealer knows that and is not worried that he is going to run out of cars.  Now convince yourself that the car you are looking at is not the last of its kind.

I’d wonder why and how this car is at a used car dealership? 4,100 miles is not much so what’s the deal? Why did the original owner sell or trade this car? Bad accident? Water, flood damage, a lemon with lot’s of problems? I’d still look at a brand new car and go for a deal on one with a full warranty and a known history. Somethings fishy here.