Requesting down payments and cash upfront for car loans is one of the oldest tricks in the book that car salesman and sales managers will use to try to control a customer. It's thought that in the car business that whoever holds the cash, holds the deal in their hands. In many ways, that's true. So, what do you do when a dealer has your money that you've given them as a deposit and can you get your car deposit back?

Although the law varies from state to state, unless you've entered into a written contract with the dealership or the seller to formally purchase the vehicle, then you are entitled to get your money back and can demand it immediately. You may find that a dealer tries to 'bluff' you into thinking that you've already made a formal commitment by writing a check or handing over cash. This is not the case however and you are entitled to get your money back.

This is one of the reasons why it is so much more convenient to arrange your auto financing with a loan company outside of a dealership or the place that you are buying your vehicle. Even with bad credit, there are top notch companies that can help you to obtain even a better deal than you would get through a dealership.

While dealership financing is not entirely bad as it does serve the needs of many people, you can save money if you arrange an auto loan either with an outside lending service or through an online channel that allows both lenders and dealers to compete for your business.