Buying a Car from an Ontario Dealer -- Can I Cancel the Contract?
May
16
Written by:
OMVIC Communications
Thursday, May 16, 2019
All shoppers know the checkout drill, you hand over your money, your goods are packaged and then the cashier tells you by rote, “You have 10 days to return or exchange, as long as you have the receipt.” You nod --- you probably won’t return your purchase, but it’s nice to know that you could. You walk out the door, and live your life.
So here’s a question. When you sign a contract to buy a car from a dealer, there is,
a. A 24 hour cooling-off period
b. A 48 hour cooling-off period
c. A 10 day cooling-off period
d. No cooling-off period
The answer is – D – there is NO cooling-off period when buying a car from a dealer in Ontario.
“The belief that there is a cooling-off period for cars is a common misconception” explains Terry O’Keefe, OMVIC’s Director of Communications. “Many Ontario residents are misinformed when it comes to understanding their ability to cancel a vehicle purchase contract.”
While some dealers may cancel a contract and return a deposit as a gesture of goodwill, they’re not obligated to do so. It’s perfectly acceptable for dealers to seek reimbursement for liquidated damages, another way of saying “out of pocket expenses," from the consumer; these are the reasonable costs the dealer will incur for letting the consumer out of the contract.
The Six Deadly Sins
After you sign a contract the deal is final and binding, unless the dealer has failed to make certain disclosures. In fact, there are six specific disclosures that trigger contract cancellation, including failing to reveal the true distance a vehicle has travelled; or not disclosing the correct model, make and year of the vehicle. For the full list, please see the image below.

While there are return policies for many big ticket purchases, including newly built condos, it simply does not exist when purchasing a vehicle from a registered dealer. Remember, buyer’s remorse isn’t reason enough to back out of a contract. So be sure you do your homework, read your contract thoroughly and understand what you’re buying BEFORE you sign on the dotted line.
If you have purchased a vehicle from an OMVIC-Registered Dealer and he or she has committed one of the six deadly sins, contact OMVIC’s Complaints and Inquiries Team (1-800-943-6002) x3942 or consumers@omvic.on.ca and they will help you through this process.
About OMVIC
An educated and informed consumer is a protected consumer. Visit omvic.ca;to learn more about your car-buying rights and when they apply, as well as additional tips for buying a car in Ontario.
For more car buying tips check out the OMVIC Academy for more resources, including multilingual videos and the downloadable OMVIC Car-Buying Guide.
Connect with OMVIC on social media!
Ontario Motor Vehicle Industry Council
@omvic_consumers
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www.omvic.ca
www.ontario.ca/page/consumer-protection-ontario
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