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Buying & selling a car

Buying from a dealer vs a private seller

There’s really no right answer to this: on the one hand you have more legal rights if you buy from a dealer - plus, it’s easier to go back to them if something does go wrong. On the other hand you’re likely to pay more than you would if you buy from a private seller.

So while we can’t say what’s right for you, we can make sure that you know exactly what your rights are in both cases.

Dealer

All Ontario car dealers have to be registered with the Ontario Motor Vehicle Industry Council or OMVIC, a group that protects consumer rights and can repay you money for a bad deal in some cases. When you buy a new or used car from a registered dealer, you have rights under the Motor Vehicles Dealers Act.

Tip: Check out OMVIC’s ‘Road to buying a car’ infographic before buying a used car in Ontario

Buying from a dealer - know your rights:

  1. No cooling-off period

    This means once you’ve signed the contract, you’ve understood the terms and the contract cannot be cancelled. Always read the contract!

  2. 90-day contract cancellation

    You can only cancel your contract within 90 days if the dealer has hidden important information from you, or lied about the condition of the car. For example, if the dealer didn’t inform you the car was once used as a taxi.

  3. No extra fees

    A dealer must advertise the final, all-in price of the car, so the only extra amount you pay is the taxes on top. For instance, the Toronto Star reported that in 2014, OMVIC fined Toronto dealer Platinum Cars Inc. $21,000 for ads that said costs did not include a $399 admin fee.

Private seller

When you buy from a private seller your rights are a lot more limited. Cars are sold ‘as is’ so you have no place to turn if you get a bad deal.

On the other hand, private sale prices can be 10-25% lower than at dealerships. Just know that most owners will tell you they took “really good care” of the car, so it’s up to you to do your research before you make a deal.

Check our tips for buying a used car.

The seller must have the right to sell the car

What does that mean..? Essentially, the seller should be a private individual, who is the current legal owner of the car.

Be aware - sometimes a dealer may illegally pose as a private seller in order to avoid their legal obligations. Such people are called ‘curbsiders.’ Look out for the following warning signs:

  • You call the seller to ask about the car and they ask ‘which one?’
  • The same phone number appears in several different car ads
  • The seller wants to meet somewhere other than at their home
  • You go to view the car and see many cars for sale on the same street
  • The seller’s name does not appear on the car’s paperwork
  • The deal sounds too good to be true
Watch out: Curbsiders are responsible for 25% of all private advertisements. To report a curbsider who sells stolen, damaged or tampered vehicles, call OMVIC at 1-888-NO-CURBS (662-8727).

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Farida started writing for ingenie in 2015. She got her Ontario licence in 2014 and her first car was a manual 2003 VW Jetta GLS 1.8T. Follow her on Twitter.