When you sign a contract to purchase a vehicle and leave a deposit at a car dealership in Ontario, the deal is final and you have no legal right to change your mind. Unlike door-to-door sales that carry a 10-day cooling-off period, vehicle purchases carry no such cancellation window, meaning buyers who walk away will likely forfeit their money.
Sudhir Nagi Loses One Thousand Dollar Deposit on Electric Vehicle Contract
The couple signed the paperwork and put down a $1,000 deposit on the new EV. Sudhir Nagi of Scarborough had planned to trade a Honda CRV for the electric car. Once they returned home, however, they began having second thoughts about the purchase. Nagi worried about the annual mileage limits they would use, the cost of vehicle insurance, and the expense of installing an electric charger at home. He noted that the purchase did not make sense given the price of the new vehicle and the number of kilometres they drive.
Nagi called the dealership to cancel the contract, but staff informed him that the deal was final and the dealership would keep his deposit. He was expected to complete the purchase as agreed. Nagi expressed shock at the outcome, noting that buyers are given no choice once they put a signature on a contract. He remains out of pocket for the $1,000, noting that as a retired person, he does not have that kind of money to lose.
Ontario Motor Vehicle Industry Council Warns Buyers About Final Sales
The Ontario Motor Vehicle Industry Council (OMVIC) recently ran an online ad campaign to warn car buyers that Ontario law provides no cooling-off period for vehicle purchases. OMVIC states on its website that consumers can avoid problems by understanding that all sales are final unless the purchase contract explicitly includes conditions allowing for cancellation.
According to OMVIC, buyers should ensure that all dealer promises are documented in writing and that they understand delivery timelines if a vehicle is not in stock or must be factory ordered. Consumers must also verify that finance terms are complete and should only sign a contract if they are entirely certain they want to purchase the vehicle.
Electric Vehicle Charging Infrastructure in Canada
Canada currently has more than 15,000 public chargers across 6,800 locations. The federal Liberals have pledged $700 million to establish at least 50,000 additional chargers by the conclusion of 2026.
Frequently Asked Questions About Vehicle Deposits and Contracts in Ontario
Can a car dealership keep your deposit if you cancel?
Yes. Once a buyer signs a purchase contract and leaves a deposit, the sale is considered final unless the contract contains specific written conditions that permit cancellation.
What steps should buyers take before signing a car contract?
OMVIC advises buyers to make sure all verbal promises are put in writing, verify finance terms completely, understand delivery wait times for factory orders, and only sign when completely certain of the purchase.
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