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OMVIC Blog: Car Buying Tips

Understanding Contracts: Vehicle Description

Oct 9

Written by: OMVIC Communications
Friday, October 9, 2020  RssIcon

Vehicle purchase agreements or contracts can be confusing. To help you feel more confident, we will look at each contract section and explain the terms, so you can better understand the document you may agree to sign.

This week, we will focus on the Vehicle Description Section, typically found at the top of a car contract. In the graphic below, each term is numbered so it corresponds with the numbered definition below.


The Vehicle Description Section

This section of the contract identifies specifications for the car you want to buy. Information in this area should be filled out by the dealer or salesperson. In case something goes wrong, the contract is the written proof of what you and the seller have both agreed to.

Let’s take a closer look at the terms found in the Vehicle Description section.

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    1.The stock number: In most instances, the stock number allows dealers to keep track of their inventory. If an advertisement mentions a stock number, knowing the number may help ensure the vehicle you’re shown is the same one that was in the ad. Note: while many dealers include stock numbers in their advertisements and on their bill of sale, there is no regulation that requires it.


    2.Year:This refers to the model year of the car. Some manufacturers release year models early. Generally, new model years arrive in the fall, so in fall 2020 you might see 2021 vehicles for sale. To verify that the correct year is on the contract, you can also check the VIN


    3. Make: The manufacturer’s name (e.g., Toyota, Volvo, Subaru)


    4.Model: This is the specific car designed by the auto manufacturer; for example, the Subaru Outback. (Outback is the model; Subaru is the make)


    5.Trim or trim level: This refers to vehicles of the same model with different features or packages. The trim level is represented by words such as “Limited” or “Sport” or letters, such as  XLE. The trim level of some vehicles can add thousands of dollars to the price depending on the features contained in the trim level.


    Note: The Motor Vehicle Dealers Act, requires the make, model, year and trim level be on a contract. To learn more, visit OMVIC’s Mandatory Disclosures


    6.Body type: This refers to the car’s shape. There are 9 classic vehicle body types: sedan, hatchback, coupe, convertible, truck, station wagon, van, SUV, crossover


    7. Colour: The vehicle’s colour.


    8. Lic. No.: Your driver’s licence number.


    9. VIN: The Vehicle Identification Number (VIN) is 17 numbers and letters unique to the vehicle. It is your car’s fingerprint; no two cars will have the same VIN.  It identifies the model year – even the country of manufacture. You should verify the VIN written on the contract matches the VIN on the car. You can usually find the VIN on the door frame, or at the bottom of the car’s windshield. If you can’t locate it, ask the dealer or salesperson to help you find it.

    10. If manufacturer warranty is applicable, time is measured from _______ to______:This details when the manufacturer’s warranty started and when it expires. A new vehicle’s warranty should not start until you take delivery of a vehicle. A “demo” or other used vehicle with remaining warranty will have a “in service date”, which will be the date the warranty clock started. If the manufacturer’s warranty has expired, expect this area to be left blank.


    11. Date of Delivery: This is the date you can expect to take delivery of the vehicle. In most cases, if the vehicle is on the lot, it only takes a few days for the dealer to prepare the vehicle for delivery. If the vehicle is being located from another dealer or factory ordered this may take more time. If you require the vehicle to be delivered by a specific date, you should ensure this section is completed with your desired date.


    12. Distance travelled: The dealer should check the odometer and enter the number on the contract. If you are buying a used car and the dealer or salesperson can’t determine the exact distance travelled, there is a special disclosure statement that needs to be written on the contract.  For used vehicles, the dealer is allowed to be within 1,000 kms or 5% (whichever is less) of the accurate number.


    13. On Delivery, Odometer Reading will not Exceed: This section is used for factory orders or when the dealer has located a vehicle at another dealership (often referred to as vehicle “locates”). Vehicle locates may be driven to the selling dealer and therefore can come with higher kms. Be sure to review this section to ensure your comfortable with the distance at delivery before signing.


About OMVIC

As the regulator of motor vehicle sales in Ontario, OMVIC’s mandate is to maintain a fair and informed marketplace by protecting the rights of consumers, enhancing industry professionalism and ensuring fair, honest and open competition for registered motor vehicle dealers. Visit omvic.ca to learn more about your car-buying rights as well as additional tips for buying a car in Ontario. For car buying tips, check out the OMVIC Academy. You can view other resources such as multilingual videos and download the OMVIC Car-buying Guide


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