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Is the Car Deposit Refundable?

1 Answers
McRyder
09/02/25 7:53am
Car deposits are non-refundable. Below is relevant information about car deposits: 1. Definition: According to China's current legal provisions, a deposit does not possess the nature of earnest money. It is merely a unilateral act without obvious guarantee characteristics. If the party paying the deposit claims earnest money rights, the People's Court will not support it. Generally, paying a deposit is regarded as paying an advance payment. When either party fails to fulfill contractual obligations, there are no consequences of forfeiture or double refund of the advance payment. The deposit can only be used as compensation for damages. 2. Difference from earnest money: Earnest money is a standardized legal concept, voluntarily agreed upon by contracting parties as a form of guarantee to ensure contract performance. As a guarantee for contract performance, the Guarantee Law stipulates that the guarantee contract (i.e., the earnest money clause) is an ancillary contract to the main contract. If the main contract is invalid, the earnest money clause is also invalid.
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