What Do You Need to Buy a Pre-Owned Vehicle in Ontario?

Purchasing a pre-owned vehicle in Ontario is a significant decision that requires preparation, knowledge, and the right documentation. Whether you’re buying from a dealership or a private seller, understanding the process can help ensure a smooth and hassle-free experience. From necessary paperwork to financial considerations and insurance requirements, this guide provides everything you need to know when purchasing a pre-owned vehicle in Ontario.

Understanding the Basics: A Glossary of Key Terms

Before diving into the details, here are some key terms you may encounter when buying a pre-owned vehicle in Ontario:

• CARFAX Canada Report: A document providing a vehicle’s history, including past accidents, previous owners, and service records.
• Used Vehicle Information Package (UVIP): A mandatory document when buying from a private seller that includes ownership history, liens, and fair market value.
• Safety Standards Certificate (SSC): A certificate issued by a licensed mechanic that confirms the vehicle meets Ontario’s safety standards.
• Ontario Vehicle Registration: A document proving ownership and required for legally driving the vehicle.
• Lien: A financial claim on the vehicle, often from an unpaid loan, which can prevent proper transfer of ownership.
• Vehicle Identification Number (VIN): A unique 17-character code assigned to every vehicle, used for tracking history and ownership.

Required Documents and Papers When Buying a Pre-Owned Vehicle

Buying a pre-owned vehicle requires specific documents to ensure a legal and smooth transaction. These include:

• Bill of Sale: A document outlining the transaction details, including purchase price, date of sale, and names of the buyer and seller.
• Vehicle Ownership Permit: The green ownership paper that needs to be transferred to the buyer.
• Safety Standards Certificate (SSC): Required to register and plate the vehicle unless it’s being purchased as-is.
• Emissions Test (if applicable): While most vehicles no longer require emissions testing, older vehicles may still need to comply with provincial regulations.
• Used Vehicle Information Package (UVIP): Mandatory when buying from a private seller; it includes ownership details and liens.
• Lien Check Report: If buying from a private seller, it’s crucial to ensure the vehicle is not under financing or legal claim.
• CARFAX Canada Report: This is essential for verifying a vehicle’s accident history and previous ownership.

Other Key Considerations Before Finalizing the Purchase

Once you have all the necessary documents, there are additional steps to take before driving your pre-owned vehicle off the lot.

1- Obtaining Insurance

In Ontario, you cannot register a vehicle without valid auto insurance. Before picking up your pre-owned vehicle, ensure that you:

• Contact your insurance provider to obtain coverage for the new vehicle.
• Provide the insurer with the vehicle’s VIN to set up a policy.
• Receive proof of insurance to present at the ServiceOntario office.

2- Registering the Vehicle and Getting Licence Plates

To legally drive your pre-owned vehicle, you must register it at a ServiceOntario location. Bring the following documents:

• The signed vehicle ownership permit from the seller.
• A valid Safety Standards Certificate (if required).
• Your proof of insurance.
• Personal identification (such as a driver’s licence).
• Payment for any applicable fees and taxes.

If purchasing from a dealership, they typically handle registration on your behalf. If buying privately, you will need to visit a ServiceOntario location to complete the process.

3- Paying the Retail Sales Tax (RST)

When purchasing a pre-owned vehicle, the buyer must pay 13% Retail Sales Tax (RST) based on either the purchase price or the Canadian Red Book value, whichever is higher. This tax is payable at ServiceOntario when registering the vehicle.

What is a CARFAX Canada Report and Why is it Important?

A CARFAX Canada Report provides a detailed history of a vehicle, including:

• Previous accident history and repair records.
• Service and maintenance history.
• Ownership and registration history (including previous provinces where the vehicle was registered).
• Whether the vehicle has ever been branded as salvaged, rebuilt, or written off by an insurance company.

This report is an essential tool in avoiding hidden surprises. While dealerships typically provide a CARFAX report with their pre-owned vehicles, private buyers should request one independently to verify the vehicle’s past.

Tips for Choosing the Right Pre-Owned Vehicle

Beyond the paperwork, selecting the right pre-owned vehicle requires careful research and consideration. Here are a few things to keep in mind:

1- Determine Your Budget

Factor in not only the purchase price but also insurance, maintenance, and potential repairs. If financing, check interest rates and monthly payments.

2- Check the Vehicle’s History

Always request a CARFAX Canada Report and review any available service records. A clean history ensures you’re making a well-informed purchase.

3- Consider the Vehicle’s Usage and Features

Think about your driving needs. Will the vehicle be primarily used for commuting, road trips, or family use? Consider fuel efficiency, safety features, and available technology.

4- Buy from a Trusted Source

Purchasing from a reputable dealership provides additional benefits, such as safety inspections, warranties, and certified pre-owned programs. If buying privately, meet in a safe location and verify all documentation.

Final Thoughts

Buying a pre-owned vehicle in Ontario requires careful preparation, the right documentation, and an understanding of the process. Ensuring you have the necessary paperwork, obtaining insurance, and completing registration at ServiceOntario are key steps in making your purchase legal and hassle-free. A CARFAX Canada Report and a lien check provide added security when buying a used vehicle.

By following this guide, you’ll be well-equipped to navigate the purchase of a pre-owned vehicle with confidence, ensuring you make a smart investment that suits your needs.