When buying a car, there are a lot of things to consider (the dealer’s reputation, the choice and state of the vehicle, etc.) – and there is a simple reason for that. Unless you have unlimited financial means, you won’t be able to just walk into a car dealership and pick a car without considering its price and how you are going to pay for it. That’s why it’s crucial that you be aware of your consumer rights in case something goes wrong with your car purchase. Stick with us to find out what they are.
In the Ontario province, you can buy a car in these 3 ways:
1) Buying outright: Using savings and making a big investment upfront without worrying about consequential payments.
2) Financing: Getting a loan directly from a bank, dealership, or credit union to buy the full value of the car. You can negotiate the length of time required to pay off the loan, the interest rate and monthly payments. Moreover, when you finance a vehicle, you get full ownership over it. You can drive it however much you want with no restrictions or additional penalties to pay. You can also sell or trade in the vehicle before the loan is over and use the value to pay off the rest of it without extra payments.
3) Leasing: Entering into a contract with a dealership or leasing company that provides you with the use of the car for a set period of time. In exchange, you have a set monthly lease payment for the duration of the lease and you are responsible for the insurance and maintenance. At the end of the lease, you can choose to buy the vehicle or return it to the dealer and then lease or buy a different one. There are restrictions on what you can do with the vehicle that come with extra cost penalties if you do not adhere to them (for example, there might be a limit on how many kilometers per year you can drive it). You also pay additional fees if you want to end the lease before it is finished.
With each of these options, there are certain consumer rights that keep you protected, according to the official Government of Canada website, but we are going to concentrate on the latter 2, as they can have long-term effects on your financial situation that aren’t that easily solvable.
When dealers arrange a car loan through a bank, federal consumer protection laws apply. However, when dealers arrange a car loan through a lender that is provincially or territorially regulated, such as a credit union, provincial or territorial consumer protection laws may apply. Keep in mind that some independent companies that specialize in car financing are not regulated at all.
Consumer protection laws require that a lender, or the dealer, give consumers a disclosure statement before entering into an agreement. The disclosure statement explains the total cost of borrowing and other important information. Always remember to read this document carefully before you sign a contract to get a car loan and make sure you get a copy of the disclosure statement.
2) Car leasing
Car leases are covered by provincial and territorial consumer protection laws. Most provinces and territories require that the dealer give you a disclosure statement before you agree to lease a car. The disclosure statement explains the total cost of leasing the car and some of your obligations under the lease agreement. Always make sure to read this document carefully before you sign a contract to lease a car and get a copy of the disclosure statement.
Making a complaint about a car dealership
Dealerships and car sales are regulated by provinces and territories. If you believe a dealer misrepresents itself, contact your provincial or territorial government’s car sales regulator or consumer affairs office. In Ontario, you can contact OMVIC and the Consumer Protection Office of Ontario.
The Ontario Motor Vehicle Industry Council licenses and regulates motor vehicle dealers in Ontario and administers the Motor Vehicle Dealers Act (MVDA) on behalf of the Minister of Consumer Services. Their goal is to maintain a fair, safe and informed marketplace by ensuring registration of dealers and salespeople, inspecting dealerships, maintaining a complaint line for consumers, conducting investigations and enforcing the Act and its associated rules and regulations. Registration with OMVIC is mandatory for Ontario’s motor vehicle dealers and salespersons.
OMVIC’s objectives are very clear:
- Consumer protection (pursuit of those who would prey on an unwary public),
- Increased consumer confidence (compliance activities and complaint handling),
- Consumer awareness (dissemination of information concerning consumer rights via public information and awareness programs),
- Dealer professionalism (certification programs for new dealers and salespersons),
- Increased accountability (administration of a Code of Ethics, Standards of Business Practice and an open disciplinary process).
CRS Automotive is an OMVIC-certified dealer whose salespersons are there to help customers find the right used luxury vehicle. We will provide assistance, but never be pushy because we value our customers. Come and see for yourself – we are expecting you at our Stoney Creek location!