Blog Selling A Car In Ontario

Oct 19, 2023

Benefits of selling a car privately vs a dealership

handshake infront of car

Thinking of selling your car? Not sure where to start? There are a number of important steps you need to take to sell your car in Ontario legally. Should you sell your vehicle privately, or trade it in at a car dealership? What steps do you have to take?

Here, we will outline the process of selling a car in Ontario. You will learn:

What to do before you sell a car in Ontario
How do you sell a car privately?
What documents do I keep when selling my car?
How to protect yourself when selling a used car privately
What are some tips for selling a used car to maximize value?
Do I need a contract to sell a used car?
Selling a car as is in Ontario
Should I sell my car to a dealership?
What impacts my car's value when selling it?
Selling a car in Ontario FAQs

What to do before you sell a car in Ontario

Choosing to sell your car privately is a popular decision. It has its advantages. But there is also a lot of information to brush up on. There are steps you need to take to sell your vehicle. Here are some key things you will need to determine when selling your car privately:

  • Vehicle value : How much is your vehicle worth? How much are you listing it for? What is your rock bottom price?
  • Preparation : What things do you need to do to get your vehicle ready for sale? Are you going to sell as is?
  • Listing : Where are you going to list your vehicle for sale? What websites?
  • Timeline : How quickly do you want to sell the car? Can you afford to wait for the right offer?

How do you sell a car privately?

Selling a car privately in Ontario involves several steps to ensure a smooth and legal transaction. Here's a general guide on how to sell a car privately in the province:

  • Prepare the car: Clean both the interior and exterior of the car and collect all car maintenance records and documents.
  • Determine the value: Research the market to determine a fair selling price for your car. Websites like AutoTrader and Canadian Black Book can help.
  • Create an advertisement: To sell your car, take clear photos from various angles and write an honest description, including make, model, year, mileage, condition, features, and price. Also, include your contact information.
  • Safety and emissions inspection: In Ontario, the seller is responsible for providing a Safety Standards Certificate (SSC) and an emissions test certificate to the buyer if required.
  • Negotiate with buyers: Be prepared for negotiations and questions from potential buyers. Ensure you meet potential buyers in a safe and public place for test drives or inspections.
  • Bill of sale: When you find a buyer, you will need to complete a Bill of Sale. You can find a standard form on the ServiceOntario website.
  • Payment: Ensure you securely receive payment, such as a certified check, bank draft, or electronic funds transfer. Verify the payment before signing over the ownership.
  • Transfer of ownership: Fill out the back of the vehicle ownership document (usually the "seller" section) and provide it to the buyer. Remove the license plates from the car.
  • Insurance cancellation: Contact your insurance company to cancel your policy on the sold vehicle.
  • Submit a notice of sale: Submit a Notice of Sale to the Ontario Ministry of Transportation within six days of selling your vehicle either online or at a ServiceOntario center.
  • Report the Sale to CRA (if applicable): If you sell your car at a profit and it's considered a capital gain, you may have to report it to the Canada Revenue Agency (CRA). Consult a tax professional for guidance.
  • Provide a Used Vehicle Information Package (UVIP): Sellers in Ontario were required to provide a Used Vehicle Information Package to the buyer.

What documents do I keep when selling my car?

It's crucial to retain certain documents when selling your car privately in Ontario for legal and tax-related purposes. Here's a list of the documents you should keep:

  • Your license plate.
  • The plate portion of your vehicle ownership papers.
  • Copy of the bill of sale, UVP, payment records, and other certificates.
  • Insurance cancellation documents.
  • Messages/correspondences between you and the buyer.

How to protect yourself when selling a used car privately

Whether you are buying a used car or selling one, you need to protect yourself. Here are some tips to protect yourself when selling:

  • Do your research : Understand the process for selling your vehicle.
  • Know your cars worth : Understand what your vehicle is worth in its current state.
  • Watch out for scams : There are scammers out there. Be conscious of people who may be trying to take advantage of you.
  • Don’t give into pressure : Brush up on your negotiation skills. Don’t give into the pressure of accepting a low ball offer.
  • Follow all laws : Follow all rules and laws in Ontario for selling your car.
  • Make sure all documentation is in order : Properly fill out all paperwork.
  • Don’t make any false claims about your vehicle : Be honest about the current state of your vehicle. Don’t make false claims in the vehicle listing.

What are some tips for selling a used car to maximize value?

We all want to get the best price possible when selling a car. You can do certain things to boost the value of your car when selling. Here are some tips for selling a car privately:

  • Take care of your vehicle : How you take care of your vehicle when you own it will affect how much you sell for.
  • Take great photos : Taking good photos of your car can get the attention of buyers. Take multiple pictures from a variety of angles.
  • Clean your vehicle inside and out : Make your vehicle as presentable as possible. Clean your vehicle. Consider getting it professionally cleaned.
  • Minor repairs : Make minor repairs that can boost your car value. Speak with your mechanic about your options.
  • Know how much your car is worth : Undervaluing your car is one of the quickest ways to lose money on the deal. Know your car value.
  • Price to negotiate : Don’t list your vehicle for your rock bottom amount. Expect buyers to negotiate. List the vehicle at a fair ideal price. But have a slightly lower price you are willing to accept.
  • Write a great ad : Writing a great ad can help you get your asking price. Be engaging, include all required information and list your ad on popular websites.

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Do I need a contract to sell a used car?

Yes. You are making a legal sales transaction. You need a record of the sale. It is most commonly in the form of a bill of sale. It can also be an agreement letter for selling a car. Include the following information in the contract :

  • Name and address of the buyer and seller
  • Date
  • Vehicle information number
  • Made, model, year, and colour of the vehicle
  • Sale price
  • Signatures of the buyer and seller

You can also include additional such as payment terms, vehicle odometer reading, and conditions of the sale.

Selling a car as is in Ontario

Many people sell a used car “as is”. Selling a car “as is” means you are selling it in its current state. Once you transfer ownership to the buyer, it is the buyer’s responsibility. If something goes wrong with the vehicle, it’s up to the buyer to deal with it. The seller has no obligation once the sale is complete.

If you choose to sell your car “as is” :

  • Be upfront and honest about the current state of the vehicle.
  • Clearly state the vehicle sale is “as is” in the ad.
  • Make sure you write the car is sold “as is” on the bill of sale.

If you sell the car “as is”, buyers will expect the car requires some work. This also means they will expect to pay less. You will have less negotiating power when you sell a car “as is”. Adjust your expectations for the sales price accordingly.

Should I sell my car to a dealership?

Many people consider selling their vehicle to a car dealership. It’s an alternative to selling privately. One of the reasons to sell to an auto dealer is the process is simpler. You won’t likely have an issue finding a dealership to buy your car.

But, you will likely not get as high of an offer. Dealers will make you an offer so they can buy the vehicle and flip it for a profit. Expect less money. But, if you need to sell quickly and hassle-free it’s a viable option. You could also use your vehicle as trade-in value if you want to get a new vehicle.

What are some tips for selling your used car to a dealership?

Use these tips if you want to explore the option of selling your vehicle to a dealership :

  • Know your cars current value
  • Get your vehicle in as good of shape as possible
  • Negotiate on price
  • Get offers from multiple dealerships
  • Consider selling to a dealership network

What impacts my car's value when selling it?

There are many things that can affect the value of your car. Consider the following when determining a sales price :

  • Make, model, year
  • Reliability and safety rating
  • Options, trim package, and add-on features
  • Vehicle accessories and modifications
  • Rarity
  • Accident history
  • Average kilometers driven
  • Condition (damage, dings, scratches, interior tears)
  • Work required (does it need new brakes? Do parts need replacing?)
  • Selling price for other similar vehicles in your area
  • Increased demand for used cars and used trucks
  • Ontario car insurance costs

To sell your car, determine a fair price using a trusted site like Canadian Black Book or CARFAX. Make sure you compare your car to other vehicles with similar features and conditions.

Confirm that you have no outstanding payments on your car loan. If you do owe money on a car loan, use the money from the sale to pay it off. Ideally, you will sell your vehicle for more than what you owe on the loan.

Selling a car in Ontario FAQs

It depends on your objective. If you want to get the most money, selling privately may be your best option. If you want to sell quickly, selling to a dealership may make the most sense. If you lease a car, you’ll need to consider transferring the lease.

It depends on the age of your vehicle. If you do require a safety, you will need to get this from a licensed mechanic. Visit a mechanic that is an Ontario Motor Vehicle Inspection Station.

It’s always a good idea to do a vehicle inspection before selling. This will help you understand any issues and how this could affect your vehicle value. Fixing some of the issues can increase the asking price.

There are lots of ways you could accept payment when selling your car. The securest option is to accept a certified cheque or money order. Cash is also a safe option. Personal cheques could bounce and the promise of an e-transfer could fall through.

Take the next step of selling your car in Ontario

The question of how to sell a car may seem like an overwhelming task, but with a little bit of research and preparation, it can be the more worthwhile option to sell your vehicle.

Contact our brokers for more information about selling your car and how your car insurance rates will be affected.