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    Buying And Selling A Car In Ont

    Buying and Selling a Used Vehicle in Ontario?






    By Ontario law, private sellers of most motor vehicles, including motorcycles, must provide buyers with a Used Vehicle Information Package. This package guides you through the process of buying or selling and helps you understand your rights and responsibilities.

    Selling a used vehicle in Ontario?
    Buying a used vehicle in Ontario?
    More Information:
    Liens (Debts on a vehicle/motor vehicle insurance)
    Retail sales tax
    Safety standards certificate
    Tax exemption
    Drive Clean
    Did you know?
    Every year, over one million used vehicles change ownership in Ontario.
    The used Vehicle Information Package includes:
    Description of the vehicle
    Ontario vehicle registration history
    Odometer information
    Outstanding debts (link to liens) on the vehicle
    Wholesale and retail values for the vehicle's model and year, if available
    Retail sales tax requirements
    Bill of sale
    Tips on vehicle safety standards inspections
    Who needs a Used Vehicle Information Package?
    You need a package only if you are privately selling a:

    Car
    Van
    Light truck (gross weight of 3,000 kilograms or less)
    Self-propelled motor home
    Motorcycle
    Some transfers may not require a Used Vehicle Information Package. For information on exemptions, spousal transfer and other types of transfers, complete our feedback form or call us at the Driver and Vehicle Licensing Call Centre:
    Toronto area: 416-235-2999
    Toll free: 1-800-387-3445 (Canada-wide)

    Why do buyers need a Used Vehicle Information Package?
    To be aware of any outstanding debts registered against the vehicle
    To see if anything in the vehicle’s registration history might cause concern
    To make sure the name of the person selling the vehicle is the same as the name on the registration
    To check the vehicle’s odometer reading last provided to the Ministry.
    Sellers must:

    Buy this package if you are selling a used vehicle privately in Ontario
    Show it to all prospective buyers
    Give it to the buyer when you sell your vehicle.
    To purchase a used Vehicle Information Package:

    Use the ServiceOntario Driver and Vehicle Online Services
    Visit any Driver and Vehicle Licence Issuing Office
    Note: you will need the plate number or the Vehicle Identification Number to buy a Used Vehicle Information Package.

    Selling a used vehicle in Ontario?
    Use this information to make sure you offer a fair and reasonable transaction.

    A seller's checklist - (printable checklist in: Pdf or MS Word
    Does the Vehicle Identification Number on your vehicle match the Vehicle Identification Number on your permit?
    - If it does not match, call us at the Driver and Vehicle Licensing Call Centre:
    Toronto area: 416-235-2999
    Toll free: 1-800-387-3445 (Canada-wide)
    Buy a Used Vehicle Information Package.
    Remember: under Ontario law, private sellers of most motor vehicles must buy and show potential buyers the Used Vehicle Information Package.
    Read it carefully to make sure the information is correct.
    Show the Used Vehicle Information Package to any interested buyers.
    Keep your licence plates and the “plate portion” of the vehicle registration permit once you sell your vehicle.
    Found a buyer?
    Finalize the sale in four steps (- printable checklist in Pdf or MS Word)

    Record your name, signature, name of buyer, date and purchase price on the “Bill of Sale” in the Used Vehicle Information Package.
    Complete and sign the Application for Transfer. The Application for Transfer is on the back of the “vehicle portion” of the registration permit.
    Give the Used Vehicle Information Package and the “vehicle portion” of the registration permit to the buyer.
    Keep your licence plates and the “plate portion” of the vehicle registration permit. You will need the permit if you decide to register your licence plates on another vehicle.
    What about the licence plates?

    Did you know?
    Ontario has a plate-to-owner registration system. This means the licence plates stay with you, not the vehicle.
    Remove your plates and keep them for your next vehicle.
    Before you attach your plates to another vehicle, visit a Driver and Vehicle Licence Issuing Office to register the plates to the other vehicle.
    If you do not plan to get another vehicle you can return the plates and the plate permit to any Driver and Vehicle Licence Issuing Office for cancellation.
    If your plates have not expired, you can apply for a refund on any remaining full months of plate validation. There is a processing fee of $5.00 for each refund.
    Buying a used vehicle in Ontario?
    Good used vehicles are in demand. With careful shopping and some research, you can find a vehicle to fit your needs.
    What should I look for?

    Did you know?
    Even a well-made vehicle deteriorates if it is not properly maintained. Do not be blinded by the reputation of a particular make or model.
    Always inspect a vehicle in the daylight.
    Carefully check for extreme wear of the upholstery, seats, brake and accelerator pedals. New pedals may signal the car has had a lot of use.
    Look closely at the exterior. Waves on the body could mean bodywork or that the vehicle has been in an accident.
    Take it for a road test that includes driving at different speeds and on different road conditions. The test helps evaluate the steering, brakes, shock absorbers and front-end alignment.
    Ask about the vehicle’s accident history. If there have been accidents, get a written summary of the accident information.
    Ask for the Used Vehicle Information Package.
    Take the vehicle to your mechanic or to a diagnostic centre for a check-up before buying.
    Some Signs of Trouble Problems It may mean....
    Steering that pulls the vehicle to one side alignment problems in the future
    Squealing brakes too much wear or improper adjustment
    Blue smoke coming from the tail pipe costly engine repairs are needed
    Lack of control when turning a corner at normal speeds or a very bouncy ride steering linkage problems, worn-out shock absorbers, or both

    Note: Odometer tampering is a criminal offence. An average vehicle gathers 16,000 to 20,000 kilometres per year. Look out for odometers showing low kilometres for the vehicle’s age and signs of wear. If you believe the odometer has been tampered with report it to the police.

    A buyer's checklist (printable checklist in Pdf or MS Word
    Make sure the Vehicle Identification Number on the vehicle matches the Vehicle Identification Number on the vehicle permit
    If it does not match, the seller must call us at the Driver and Vehicle Licensing Call Centre:
    Toronto area: 416-235-2999
    Toll free: 1-800-387-3445 (Canada-Wide)
    Get the vehicle permit with the completed Application for Transfer from the seller.
    Get the “Bill of Sale” from the seller. Make sure the seller fills out their name and signature, date, and purchase price.
    Bring the plate portion of the vehicle permit. (if you are attaching your plate to the vehicle)
    Ask to see the Used Vehicle Information Package. If you buy the vehicle, make sure the seller gives you the package.
    Bought a used vehicle? Finalize the purchase (printable checklist in Pdf or MS Word
    As the new owner, you must register your used vehicle within six days of the sale. Here is how:

    Bring the Used Vehicle Information Package and the vehicle permit with the completed Application for Transfer to a Driver and Vehicle Issuing Office
    Pay the retail sales tax. At the time of the transfer, the Driver and Vehicle Licence Issuing Office collects the tax. The amount of tax is based on the purchase price or the wholesale value, whichever is greater
    Pay the licensing / fees for plates and permit
    Trailer plate and permit = $35
    Passenger, Commercial, Motorcycle and Moped Licence Plates and permit = $20
    Attaching Plates you already own = $10
    To validate a plate, the plate holder must pay for the validation sticker, which is calculated from the date of the vehicle transfer to the expiry date of the licence plates.
    Transfer fee for a snowmobile is $6 and the annual validation is $15
    Present proof of insurance (if you are going to put plates on the vehicle)
    Get a Safety standards certificate if the vehicle will be plated and operated on the roads. This is not required for trailers or mopeds or off-road vehicles or snowmobiles.
    If your vehicle is registered, plated and in the Drive Clean program, show the vehicle emissions report. To find out if your vehicle needs to pass an emissions test, call the Ministry of the Environment’s Drive Clean Call Centre:
    toll free: 1-888-758-2999 or
    visit Drive Clean
    If this is the first time you have registered a plate or vehicle with this ministry, present proof of identify (verifying legal name, date of birth and signature).
    If you are registering plates that you already have, bring the plate portion of your vehicle permit with you to the Driver and Vehicle Issuing Office
    Questions? Call us at the Driver and Vehicle Licensing Call Centre:
    Toronto Area: 416-235-2999
    Toll Free: 1-800-387-3445

    Liens (Debts on a vehicle)
    Nobody wants to watch a tow truck take away the car they just bought. But that is what can happen, if there is an outstanding debt, or lien, on a vehicle you have purchased. This is one reason why it is so important to get a Used Vehicle Information Package and check the lien information.

    Buyers
    Did you know?
    If the lien is not paid, the secured party (debt holder) can reposses the vehicle from the person who owes the money or from the buyer of the vehicle.
    If there are debts registered in Ontario on the vehicle, the lien information will tell you:

    The name and municipality of the person who owes the money. If a business owes the money, the package will have the full street address
    The name and address of the lender (the secured party)
    The place where the debt is registered
    The amount of the debt
    Note: this information may not be current. The date shown on the package is usually two days behind
    Sellers
    It is important to check the lien information in the Used Vehicle Information Package because the lien can be registered against you.

    Lien Information Package Check If... Then...
    You want to transfer the lien to the buyer




    Contact the Ministry of Government Services:
    Toll Free: 1-800-268-1142
    Toronto: 416-326-8555
    TTY: 416-326-8566 (for the speech/hearing impaired)

    You have already paid off the debt Contact the lender and ask them to clear the debt

    The package lists previous owners as debtors






    Contact each lender to get an update on the debt
    If the debt was paid, ask the lender to clear the debt
    If the debt is not paid, it continues against the vehicle until it is paid. The lender can also take back the vehicle at any time

    The debt is paid and the lender has not cleared it








    The lender must register a clearance within 30 days
    If the lender has not registered a clearance, you can write a notice to the lender requiring them to pay you - $500 and any damages resulting from not clearing the debt
    The Ministry of Government Services, Personal Property Security Branch removes a clearance registration within 60 days


    Learn more
    For more information on liens, call the Ministry of Government Services, Personal Property Security Branch:
    Toronto area: 416-325-8847
    Toll free: 1-800-267-8847
    Telephone Device for the Deaf: 416-326-8866

    For information about commercial vehicles, contact the Ministry of Government Services.

    Motor vehicle insurance in Ontario
    You must have motor vehicle insurance to drive in Ontario. Whether you are attaching plates, renewing registration or buying a temporary permit, you must have insurance. Private companies sell insurance.

    What types of insurance do I need?

    You must have third party liability insurance of at least $200,000. This covers you in case you injure or kill someone or damage someone’s property. Collision insurance to cover the damage to your own vehicle is a good idea, but not required by law.

    Do I need to carry the insurance card with me?

    Yes. You must carry the pink insurance card for the vehicle that you are driving (this includes your own or someone else’s vehicle). You must show this card when a police officer asks for it. If you do not, you can receive a fine of up to $400. When driving someone else's vehicle, make sure the insurance covers you as a driver.

    Retail sales tax
    You must pay sales tax when you buy a used vehicle privately. The amount of tax is on either the purchase price or the vehicle's wholesale value, whichever is more.
    What is the “wholesale value”?

    Wholesale value is based on the Canadian Red Book, which lists the wholesale and retail values of used vehicles. This book is an accepted industry standard used by car dealers, insurance companies and other provincial governments.

    How are the wholesale and retails values determined?

    For personal vehicles, these values are based on the average amounts paid for vehicles of the same year, make and model. The values do not take into account optional equipment, vehicle condition, or the number of kilometres. These values can change from the date you pick up the Used Vehicle Information Package to the date of the vehicle transfer.

    For passenger and light commercial vehicles (2,200 kilograms and under empty weight) 20 years or older, the retail sales tax is payable on the purchase price, replacement value for insurance purposes, or appraised value, whichever is more.

    If you paid less than the Canadian Red Book value, you can get the vehicle appraised before changing ownership. If the appraisal supports a lower price then the Canadian Red Book, the buyer pays tax based on the higher value.

    An appraisal or insurance document showing the vehicle’s value must accompany the bill of sale.

    If the vehicle transfer and tax payment based on the average wholesale value are complete, an appraisal and an application for a tax refund must be sent to the Ministry of Finance. Appraisal forms are available from Driver and Vehicle Licence Issuing Offices and Ministry of Finance offices.

    Note: if you are buying a vehicle from a licensed motor vehicle dealer, you must pay the Retail Sales Tax and the Goods and Services Tax to the dealer. If you are buying a vehicle privately, you are not required to pay Goods and Services Tax.

    Tax exemption
    You do not have to pay retail sales tax if:

    You are a qualifying Diplomat or Status Indian. You can complete a transfer by showing your identity card.
    You receive a vehicle as a gift from a close family member, such as:
    Spouse
    Parent or step-parent
    Grand-parent
    Son or step-son
    Daughter or step-daughter
    Grandson or granddaughter
    Step-grandson or Step-granddaughter
    Son-in-law
    Daughter-in-law
    Father-in-law
    Mother-in-law
    Note: only one tax-free transfer per vehicle is allowed every 12 months within your close family.

    For some transfers, such as gifts between family members and transfers for insurance purposes, you must have a statement sworn before a Commissioner of Oaths. Present this statement when registering your new vehicle at a Driver and Vehicle Licence Issuing Office.

    Safety standards certificate
    To register a motor vehicle as fit, you must have a safety standards certificate. An authorized mechanic at a government approved Motor Vehicle Inspection Station inspects the vehicle, for a fee, and issues a signed certificate if the vehicle passes inspection. The certificate is valid for 36 days from the date of the inspection. The certificate is not a warranty or guarantee on the general condition of the vehicle.

    You will be asked to show this certificate when you:

    Register a rebuilt motor vehicle
    Transfer a used motor vehicle to a new owner as fit
    Certain transfers, such as between spouses do not require a Safety Standards Certificate. However, transfers between parent and child and vice versa require a Safety Standards Certificate. For further information on vehicle transfer Safety Standards Certificate exemptions, please contact ServiceOntario's Driver and Vehicle Contact Centre at (416) 235- 2999, or toll free (Canada-Wide) 1-800-387-3445
    Register a motor vehicle as fit in Ontario that was previously registered in another province or country
    Change the status of a vehicle from unfit to fit
    Note: a Safety standards certificate is not required when registering a used motorized snow vehicle, off-road vehicle, motor assisted bicycle (moped), or trailer as fit.

    Learn more:

    Safety Standards Certificate - Frequently Asked Questions
    Drive Clean
    License Issuing Office
    ServiceOntario Kiosk
    Order Online
    Consumer Tips - How to Avoid Unknowingly Buying a Flood Damaged Vehicle


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    my wife (RIP) hated my jeep too so i ran her over with it and now we are both happier (me and the jeep)

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    Now that's a mouth full.... Great post Mug's
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    My god! in BC all I need to sell a vehicle is the registration slip, and a signed "transfer of ownership" form
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    Quote Originally Posted by mugsy View Post
    If there are debts registered in Ontario on the vehicle, the lien information will tell you:

    The name and municipality of the person who owes the money. If a business owes the money, the package will have the full street address
    The name and address of the lender (the secured party)
    The place where the debt is registered
    The amount of the debt
    Note: this information may not be current. The date shown on the package is usually two days behind
    I don't know about that. I'm hoping to purchase my first used vehicle and so I purchased a "Used Vehicle Information Package". It shows that there is a Lien and who it is too, but not the amount. I don't think RBC will release the lien amount either. I'm sure the lien could either be a car loan or secured LOC, but I'm sure it's going to give me problem when trying to get a bank loan for the car.
    OF4WD Member # 5887

    Quote Originally Posted by craveneh View Post
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    It's not your job to get the lien released, its the sellers. Tell them to get a letter from RBC releasing the lien. RBC is not going to do that for you. Be very careful if you buy a car with a lien on it, you are now relying on the other person pay off that loan and not let it go into default or they will come and take YOUR car back.


    I bought a used/company car from a Chrysler dealership years ago, that belonged to the Service Manager. 2 years later I got a letter from Chrysler's Finance department saying that I owned they $2300 or they were taking my car back. I called them and they said they were unable to located the previous owner and he had defaulted on the his loan and as I was holding their collateral, they wanted it or the balanced paid by me. I informed them that the prevoius owner was a Chrysler Employee still working at the Dealership I bought it from and they might want to call him at work. I never heard another thing about it after that.

    With the way things are going with the economy today, I would NOT by that car without getting the Lien released first. JMO


    Not all creditors with have the amount of loan/lien register, you now have to pay to pay extra fee's ( IIRC) to do that and if its a small amount they may not do it.

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    The current vehicle owner said something to me that raised a flag. He said after he received payment, he would pay off the lien and get me the lien release letter/proof after. I'm generally not comfortable with that idea, but how is he supposed to pay off a lien before selling the vehicle?

    I called RBC and they said I could have my bank loan pay the lien, not the owner. That way the lien is paid in full and he gets the difference and I'm worry free.

    Maybe I should start a new thread about this...

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    Yep, you can have your loan pay off his lein directly to his bank, if what he owes is less than what you are paying, that way there is no issue with him pocketing the money, I have done that before. Make sure the bank gives you a letter saying the lien has been removed. That is pretty common.

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    The last time I went to the bank for a loan on a vehicle with a lien, they said no problem, but would only approve it if they paid the lien off directly, and handed me a check for the difference.
    You never truly know your limits until you exceed them....

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    Thats good to know guys. I greatly appreciate the information. I'm hoping to take a look at the vehicle tomorrow. Today at some point I have to call up an insurance company and my bank.

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    Give him a check with both his name and banks name on it, or better yet meet him at his bank.

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    Yeah, somebody suggested that I put his name and the name of the bank on the check (and use AND, not OR). That way the bank takes what is owed to them. But how am I sure they will put this towards the lien and not another one of his loans with the bank.

    Also, if the lien is less than for the selling price of the vehicle, unless he pays it off, I'm responsible.

    I'm sure I'm making this a lot more complicated than it has to be. I already have an insurance quote, and I'm meeting him tomorrow to look over the Jeep. If I like what I see, I'll find out what the bank will give me and then I'll start negotiating. And I'll basically go to his bank to use my car loan to pay off his lien.

    If any of you guys are bored, you're welcome to come along for the ride to London to check out the Jeep.

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    mugsy is offline Mugsy the Animal Steel-Moderator
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    just meet at his bank to pay for it....safer

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    is drive clean certificate good for 6 months or a yr?

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    12 months, u can goto driveclean.com and input a vin# to check any etest on a vehicle
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    Where does a Commissioner of Oaths reside, say in Brampton? thx in advance

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