How to Return a Financed Car

Buying a new or used car is an exciting time. But in some instances, car buyers splurge on a car purchase and they finance a vehicle that's beyond their budget. Fortunately, there are ways to cancel an auto purchase and return a financed car. And depending on the loan contract, you may be able to return a financed car and avoid credit damage.

Review the auto contract. Depending on the auto dealer, you may be able to return a financed vehicle within a specific time period and cancel the agreement, usually within three days of the purchase. Read your sales agreement.

Notify the dealership and finance company. If your sales agreement permits returning a financed vehicle, contact the auto dealer and your auto lender immediately. Mention you intent to return the car and cancel the auto loan.

Return the car in good condition. Excessive mileage and damages void a return policy, and the dealership will not accept the car.

Be prepared to pay interest on the car loan. Interest on the car loan incurs the moment you sign the loan papers. Before canceling the auto purchase, the finance company will require an interest payment.

Do a voluntary repossession. If unable to cancel an auto purchase, consider a voluntary repossession. Bring the financed vehicle back to the dealership. The dealer will auction off the vehicle and use funds from the sale to pay off the finance company.


  • In the case of voluntary repossessions, if the auctioned vehicle sells for less than the loan amount, you're responsible for the remaining balance. A voluntary repossession results in a credit score decrease.