Dealer Disclosures | OMVIC
In the market for a new or used car? Thinking of trading-in your vehicle for a new one? Find out what disclosures dealers have to make, and what YOU must do as a consumer!
Thinking of purchasing a new or used car? Did you know dealers by law must disclose incident or collision repair damage over $3,000? But did you also know YOU as a consumer have to make these disclosures to a dealer when trading-in your own hunk of metal for a new one?
“The Motor Vehicle Dealers Act sets out explicit information a dealer must disclose related to a vehicle’s past use, history and condition,” explains Terry O’Keefe, Director of Communications for OMVIC — Ontario’s vehicle sales regulator. “Proper disclosure provides transparency to consumers, so they know exactly what they’re getting themselves into before signing the contract and driving away.”
By law, all salespeople and dealers are required to include written statements about 22 conditions on a vehicle contract. Some of the most common types of disclosures include the following:
- If a vehicle has been in an incident or collision resulting in more than $3,000 damage (and the total cost of repair)
- Previous use of the vehicle as a daily rental (unless the vehicle has subsequently been owned by someone other than a dealer)
- If there are any needed repairs to major components of the vehicle (engine, transmission, power train, sub frame/ suspension, computer, electrical system, fuel system, air conditioning)
- If a vehicle has been branded (irreparable, salvage or rebuilt) or declared a total loss
- If the vehicle has been registered outside of Ontario, and where within the last seven years
“If a consumer chooses to buy privately, they need to take extra precautions…”
HOW DO DEALERS KNOW THE VEHICLE’S PAST USE?
You might be wondering how a dealer could possibly know all the necessary information about a car’s history. Often times, much of this information is readily available in history reports such as CarProof or CarFax.
Dealers are also expected to exercise due diligence in providing proper disclosure to consumers, which includes some of the following best practices:
- Conducting thorough inspections of all vehicles
- Using a paint gauge to identify painted panels and possible repairs
- Collecting required information from a customer’s trade-in
“If dealers are required to provide these disclosures in writing to a consumer, they are also expected to collect that information from a consumer when dealing with a trade-in,” advises O’Keefe.
CONSUMERS AND VEHICLE TRADE-INS
Just as you would expect a dealer to properly disclose a vehicle’s past use or condition, consumers should do the same when trading-in their own vehicle!
History reports (CarProof or CarFax) are also readily available to consumers and will provide comprehensive information on the vehicle’s history including:
- Lien information (CarProof only)
- Vehicle’s past-use
- Accident damage (including repair estimates)
- If the vehicle was previously registered outside of Ontario
- If the vehicle was branded under the Highway Traffic Act as irreparable, salvage or rebuilt, or was declared a total loss by an insurer
But remember, there are no mandatory disclosure requirements for private sales. The 22 required disclosures only apply if a consumer purchases from an OMVIC-Registered Dealer. “Only then are consumers protected by OMVIC and Ontario consumer laws,” reminds O’Keefe. “If a consumer chooses to buy privately, they need to take extra precautions and conduct their own research on the vehicle before sealing the deal.”
For more information on mandatory disclosures and your consumer rights, visit omvic.ca.