What does a null-and-void car loan mean?

I traded in my old car for a used vehicle worth $4,000. I've been driving the car for a few days. Then the dealer called me, saying financing fell through and the loan is null and void. What does this mean?

Answer provided by
Eric Schad
Answered on Apr 27, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
“If the loan is null and void, that means it’s no longer a legally binding document. Because of that, you technically don’t own the car anymore. As a result, you’ll have to take it back to the dealership.
However, you should get your down payment (if any) returned and credit for the value of your trade-in. Unfortunately, you’ll be without a car for a while. It’s in your best interest to find out why the loan fell through and what you can do to secure financing.
In the future, make sure to get pre-approval before you go car shopping. This is a rare instance where the dealer let you drive away before approving you for financing. Be wary of such dealers in the future and go to a bank or credit union for financing.”

Did this answer help you?

Ask us a question by email and we will respond within a few days.

Have a different question?

You can meet us at our office and discuss the details of your question.

Easiest way to compare and buy car insurance

No long forms
No spam or unwanted phone calls
Quotes from top insurance companies