What to do if financing of my new car fell through and I cannot get my trade-in back?
Last month I purchased a new vehicle with a trade-in. For financing the dealer required proof of income in the form of income verification, which was supplied and accepted. The dealer told me to take the vehicle home and I would be notified. A few days ago I received a call stating that there was a problem with the proof of income and I had to supply more information; if not the car would have to be returned. Since there is nothing more to provide I agreed to return the new vehicle but now the dealer cannot return my old car in because they do not have it. Is there any recourse?
Yes...you can sue the dealer.
If the transaction cannot be consummated--e.g. you can't get the financing for the new car--then it has to be rescinded--essentially voided. You get your trade-in and any deposit back (possibly less some reasonable administrative costs, etc.), they get the new car back. They cannot, however, require you to give the new car back and not return your old car, or, in the alternative, pay you the value of the old car. The dealer needs to either get the car back from the buyer (e.g. offer him something worthwhile to return it) and give it to you; or else pay you essentially its blue book value; or find a way (e.g. they themselves loan you the money, ignoring the proof of income, etc. issues) to let you buy the new car.
If they won't do this voluntarily, you should have grounds to sue them.