No cooling-off period: What Ontario car buyers need to know

Knowing there is no cooling-off period for vehicle leases or purchases in Ontario is an important piece of information when car-shopping. This means that the sale is final once a contract is signed. This can be a shock for many, particularly those who may have buyers’ remorse after making such a significant purchase. However, there are protections in place to ensure that before you make that big decision, there is transparency and fairness in these transactions.  

Mandatory disclosures: 

Prior to completing a sale, registered dealers must provide specific disclosures. These disclosures include the previous use of the car, whether as a taxi, police car, or as a daily rental. They must also disclose damages to the vehicle greater than $3,000, the vehicle’s make, model, and model year, any branding like salvage or rebuilt status, and the actual distance the vehicle has traveled. This is to protect consumers and ensure they have all the information at their disposal to make a well-informed decision. 

Liquidated damages: 

Because there is no cooling-off period in Ontario, when a contract is signed and later canceled, dealers may claim liquidated damages to cover losses incurred due to the cancellation. These damages can include advertising costs, administrative expenses, and the potential profit lost due to the sale not being completed. It is important to understand that if a dealer agrees to cancel the agreement, they may not return the deposit or only refund a portion of it. This can sometimes lead to unexpected expenses for the buyer, so it’s crucial to do your research before buying a car and be sure of your purchase before signing a contract. 

If you decide not to proceed with a vehicle purchase and no contract has been signed, the dealer must return your deposit upon request. This protects consumers who may change their minds before finalizing a purchase. Knowing this can provide a sense of security when you are still in the decision-making process. 

To protect yourself when purchasing a vehicle, always review the contract thoroughly before signing. Make sure you understand all the terms and check that the dealer has disclosed everything about the car in writing, verbal disclosures are not enough by law. If something is unclear, ask questions—there are no silly questions when it comes to your money.