Buying a Vehicle
OMVIC stands for Ontario Motor Vehicle Industry Council. OMVIC's mandate is to maintain a fair, safe and informed marketplace by protecting the rights of consumers, enhancing industry professionalism and ensuring fair, honest and open competition for registered motor vehicle dealers.
Dealers are required to remit $5 for applicable transactions as of February 1, 2008. The applicable date for determining whether a particular transaction is subject to the transaction fee is the date the agreement with the customer was entered into (i.e. not the date the vehicle is delivered or the date registration is transferred to the customer).
The Ontario Motor Vehicle Industry Council enforces the Motor Vehicle Dealers Act (MVDA).
"As the regulator of motor vehicle sales in Ontario, OMVIC's mandate is to maintain a fair, safe and informed marketplace by protecting the rights of consumers, enhancing industry professionalism and ensuring fair, honest and open competition for registered motor vehicle dealers.
It's important car buyers understand the protections and rights they have depends entirely upon whom they buy from. Consumers who purchase from registered dealers are protected by OMVIC and are entitled to full disclosure and all-in pricing. Consumers who buy privately have NO protection; no consumer law covers private transactions."
For full information on OMVIC please see this website.
An excise tax of $100 is payable for vehicles with air conditioning that are purchased in Canada or imported from the United States. This tax is payable to CBSA at the border when the vehicle is permanently imported into Canada.
Excise tax (Green Levy) on fuel inefficient cars
This tax is applicable to vehicles purchased in Canada or imported from the United States and is applied to a passenger vehicle if it:
- is a car, SUV or van with a weighted average fuel consumption of 13 litres per 100 km or higher, and
- was put into service after March 19, 2007.
Vehicles are taxed, based on weighted average fuel consumption, at the following rates:
- At least 13, but less than 14 litres per 100 km: $1,000
- At least 14, but less than 15 litres per 100 km: $2,000
- At least 15, but less than 16 litres per 100 km: $3,000
- 16 or more litres per 100 km: $4,000
For more information, please visit this website.
MSRP stands for Manufacturer's Suggested Retail Price.
MSRP is an acronym that stands for manufacturer's suggested retail price. Manufacturers (i.e. Audi) use MSRP as a base price to give retailers their estimated value of a product. This is not the usually the actual price of an item, but rather what the manufacturer suggests as the maximum price that the item could be expected to sell for.
Dealers, are free to offer the vehicle for a lesser price, but never more on a new retail vehicle.
MSRP generally does not include additional trim levels, options, accessories, Freight, PDI, administration fees, or taxes.
MSRP Definition / MSRP Means
The definition of MSRP is "Manufacturer's Suggested Retail Price"
The Meaning of MSRP
MSRP means "Manufacturer's Suggested Retail Price
In Canada, we're pretty used to paying more than the price we see on a price tag. In Ontario, sales tax is now 13%, meaning whatever the price you see is, add 13% to it for your final price. But when you are looking at buying a new car, you'll usually see a set of fees that you hadn't seen before.
What the fees are called might vary depending on the dealership, but most often they'll be called "delivery and destination" or "freight and PDI." But what does that even mean? What are these fees and why do you have to pay them?
Freight
Freight, or destination, is the charge for getting the vehicle from the factory to the dealership. This could involve shipping the vehicle from across an ocean, driving a vehicle across the country or packing something up a bit more delicately. Manufacturers set the freight price based on the nameplate for the vehicle, so no matter where you are, you'll pay the same price. Many vehicles are not manufactured in Canada, so this set fee ensures that even if the vehicle is shipped from somewhere overseas like Japan, you'll still pay that price. These costs are also standard across the country, so someone in B.C. will be paying the same fee as someone in Ontario. This fee will usually be higher with bigger and more luxurious vehicles, as the cost to transport them will be much higher than a regular sized vehicle.PDI (Pre-Delivery Inspection)
PDI, or delivery, is the charge for a technician at the dealership to inspect the car to make sure it has no cosmetic or mechanical issues. Just because a vehicle is brand new from the factory, doesn't mean it's ready for you to take home. It's also for the wash crew to run the vehicle through the car wash and make sure the car is presentable for the new owner. They'll also apply any final touches they need such as filling up the gas tank and topping up fluids.All-In Pricing
While the MSRP (Manufacturer's Suggested Retail Price) is the most common price you'll see in many commercials and advertisements directly from a manufacturer, that price doesn't show the whole picture. At Weins Canada, we practice something called "All-In Pricing." This means that the price we advertise includes the MSRP plus all fees, except for HST and licensing. So the prices you see on any of our dealer websites include the freight and PDI fees. This practice makes it easier for you as a customer to know exactly what you're going to be paying for a new car.An Ontario Ministry of Transportation (MTO) Safety Standards Certificate (SSC) is a document that certifies a vehicle's fitness. You can buy and register a vehicle without a safety certificate, but you cannot put your own plates on the vehicle or drive it without one. Any inspection station in Ontario licensed by the Ministry of Transportation can issue a Safety Standards Certificate, provided your vehicle passes an inspection.
A Safety Standards Certificate is valid for 36 days after the inspection. However, the certificate is not a guarantee or warranty that the vehicle will stay fit for any period.
What is a Safety Standard Certificate (SSC)?
An SSC is a certificate that is issued by a government- approved Motor Vehicle Inspection Station (MVIS) after a vehicle passes an inspection. This inspection covers the minimum safety requirements for vehicles in the province of Ontario.
When do I require an SSC?
An SSC is required when:
- registering a rebuilt motor vehicle;
- transferring a used motor vehicle to a new owner as fit;
- registering a motor vehicle in Ontario that was previously registered in another province or country;
- changing the status of a vehicle from unfit to fit.
Is an SSC a warranty on my vehicle purchase?
An SSC is not a warranty or guarantee on the general condition of the vehicle. The SSC only certifies that on the date it was issued, the vehicle met the minimum safety standards as set down by Regulation 611 of Ontario's Highway Traffic Act (HTA).
How long is an SSC valid for?
For the purposes of transferring ownership, an SSC is valid for 36 days from the day that the SSC was issued.
For full details, please visit this website.Buying a used vehicle can be a very stressful experience. In any situation where you're spending so much money, you want to be sure you have all the information available on what you are buying to make the best decision you can. You don't want to go on just what you've been told - you want impartial, thorough, accurate, and timely data. As well, not only do CarProof reports protect your wallet, but most importantly, having this information helps protect your family from the possibility of purchasing a vehicle that could be unsafe.
From accident information to fire damage, from liens to registration information: CarProof reports are the most detailed and complete vehicle history reports available to you. Unlike our competitors, CarProof reports offer all this and more:
Real-time Data
CarProof is electronically connected "live" to their data sources. This means that data is always current. Other services purchase periodic data dumps that will often miss information that we capture.
Cross-Canada Guaranteed Lien Info
CarProof is the only service that provides consumers with guaranteed cross-Canada lien search information. CarProof is connected live to each provincial and territorial Registrar responsible for maintaining these records. Other vehicle history report companies, including Carfax, do not report any Canadian vehicle lien information. Further, only CarProof offers a guarantee regarding enforceable liens.
Accident Data
CarProof has access to critical accident data that will allow you to make a more informed decision when buying or selling a used vehicle.
Registration & Branding
CarProof is the only service that is available to consumers providing critical real-time registration and branding information. This information discloses in which province or territory a vehicle is and/or was registered and what brand is associated with the vehicle (stolen, salvage, rebuilt, non-repairable, normal, etc.).
Full U.S. History
CarProof provides consumers with data from one of the largest U.S.-based vehicle history services. Through our connection to Experian Automotive's 2 billion+ record database, all of our reports include the data you would get from other popular U.S.-based vehicle history report services, but we also include important auction declaration information that others do not.
An AS-IS vehicle is unfit, not e-tested and is not represented as being in road worthy condition, mechanically sound or maintained at any guaranteed level of quality. The vehicle may not be fit for use as a means of transportation and may require substantial repairs at the purchaser's expense. It may not be possible to register the vehicle to be driven in its current condition.
Finance
Here is an example that shows the difference in your monthly payment depending on whether you lease or finance your vehicle.
| Lease | Loan | |
|---|---|---|
| Term | 48 Months | 48 Months |
| Interest Rate | 7.95% | 6.95% |
| Selling Price | $ 18,000.00 | $ 18,000.00 |
| Taxes* | N/A | $ 2,340.00 |
| Selling Price | $ 18,000.00 | $ 20,340.00 |
| Lease End Value | $ 9,000.00 | N/A |
| Base Payment | $ 277.29 | N/A |
| Taxes on Payment* | $ 36.05 | N/A |
| Total Payment | $ 313.34 | $ 486.59 |
The MSRP and rates used above are approximate and used only as an example. Please see your Dealer for current finance and lease rates.
*Taxes (GST & PST) are 13% in this example.
Lease
- New car, all the time. Leasing a car means you always get to drive around in a nice new car. For many people, this is an emotional boost that can't be ignored. If you love cars and driving, this is a big perk.
- Less maintenance issues. Because you're always driving a newer car, you usually don't have to deal with the regular maintenance issues that car owners face as their vehicles age. You turn in your car before all those problems start showing up (e.g. worn rotors or slipping transmission). If you lead a very busy life, or you're on the road a lot, this is one less stress you have to deal with.
- Leases are tax deductible for small businesses. If you're self-employed, commissioned sales or you own a business, you can write off your lease as a business expense. This means up to 80% depending on usage and mileage driven.
- "Afford" a nicer car. If you've ever wondered how it is that so many people can afford to drive an ***CAR1*** or ***CAR2***, then wonder no more. According to LeaseGuide.com, around 75% of all luxury cars are leased. The reason is because banks don't like to loan out more than $30,000 for a car loan. If you want a car that's worth more than that and you don't have the money to make up the difference, leasing is your only option. On the upside, your monthly payment will be lower than if you actually bought a car. Leasing allows you to "afford" a nicer car than you'd get if you had to buy it.
- Few upfront costs. Speaking of costs, leasing allows you to get into a car with very few "upfront" costs. You often don't need a down payment (or if you do, it's fairly low), your monthly payments are lower, and your sales tax is going to be a lot lower since you only have to pay tax on the value of the car you actually used. According to Edmunds.com, this means that during the life of your lease, you're going to pay roughly half the sales tax you would if you bought the car.
- Cost of Interest. The cost of interest on a lease is equal to 1% less on a finance. This because on a finance you are paying interest on the tax you paid up front for the purchase. The lease only calculates the interest on the cost of the car and tax is paid on the monthly payment.
- Residual value. This is the value of the car or truck at the end of the lease. An inflated residual value lowers your monthly payments, but it can also handcuff you. A more realistic residual value will make it easier to sell the lease, trade your vehicle in the middle of the lease or buy the vehicle at the end of the lease. The more realistic the residual value the more options you have during and at the end of the lease
- Buy what appreciates. Regardless of the car you choose it will lose value over its lifetime. Use your cash to pay down high interest debt, pay down your mortgage or top up your RRSP. All will save you money and in the case of your mortgage or RRSP increase your net worth. A car is a bad way to invest your money. Lease the car, pay for the usage and then decide if you want to keep it by buying it out or replacing it. Lots of options and your money is still at work for you.
- Cash Flow. For the same cost of a car loan, leasing provides a lower monthly payment. With the rising cost of gas, maintenance and insurance you can have your car payment, insurance and some of you gas or maintenance for the cost of a monthly loan payment.
- Flexibility. Long term loans stretch your borrowing, thus locking you in for a longer period. Leasing allows you to turn your car over in a shorter time. Or if you have a career or lifestyle change you simply pay of the difference between the lease payout and the cars value to move the car or get into a new one. A properly structured lease will give you the options you need if required.
An open lease is for someone who wants a lower residual value or who is looking to lease and then buy their car. The lessee guarantees the residual value. Closed end leasing allows you to lease with a specific mileage allowance and return the car at the end of the lease if you at or under this mileage with no additional cost. You are responsible for excess wear and tear on a closed end lease.
We allow you to trade in your lease for a new or preowned vehicle. We also offer lease extensions or you may buyout your lease.
The insurance company will settle the claim based on the mileage and market value of the car, like they would if you financed. In most cases the settlement will payout the vehicle. But if you have higher mileage then you may have to pay some money. Usually the deductible is payable. On new cars insurance companies offer a waiver of depreciation coverage that will pay off the replacement value of vehicle. This coverage will vary from 18 months to 60 months depending on the company. Ask your broker for this on all new lease vehicles.
Leasing is just an alternative form of financing a vehicle. Instead of paying your loan to zero the residual value is set for the vehicle. This residual value usually reflects the future value based on a specific mileage. For example a lease will allow 24,000 km per year and the residual value will be set for this mileage. You then have the option at the end of the lease to buyout your lease, return it if it is under mileage or extend your lease till you buy it or trade it for a newer model.
Most leases allow for you to negotiate the selling price or capital cost of the lease.
You can trade in your owned, financed or leased vehicle against a new lease. Remember that if you have a finance or lease the trade value will need to cover paying out the vehicle. A fully owned vehicle will act as a down payment with the benefit of saving you the HST on its value. Any equity in a financed or leased vehicle will also act as a down payment toward your new lease.
A down payment is paid to lower the amount being leased, thus lowering your monthly payment , residual value or both. The amount due at signing (or Payable at Delivery) will include the down payment plus tax and any other amounts due. These may include first payment, security deposit, licensing and any other miscellaneous costs
If you would like to end your lease early our dealership can assist you with either buying out or trading in your lease. To do this, a buyout amount will be calculated, a buyout is simply what you owe on your lease. If your vehicle is worth more than you owe you can put that equity towards your next vehicle. If it is worth less than you owe will have to cover that shortfall by either paying the amount, or adding it to your next lease.
When you purchase a vehicle you pay all the tax up front. When you lease a vehicle you pay the tax on the monthly payment.
Your insurance will cover a temporary driver that has the lessee's permission. If someone is driving the vehicle regularly you may need to add them to the insurance as a secondary driver
Not all leasing companies are licensed to do business in other provinces. So you may need to either return your lease and settle your lease or have someone take over your lease.
Every lease has a predetermined mileage allowance. You will be responsible for any mileage over your allowance. So always make sure you negotiate enough mileage to cover your driving habits. I t can be expensive to pay it at the end of the lease in one lump sum verses paying a little more each month on your lease.
Yes, you will have a payout that needs to be covered on your lease. If your vehicle is worth the same or more than the payout you are good but if it is worth less you will have to pay out the difference. Some leasing companies will allow you to add this deficiency to a new lease. This will vary from brand to brand.
Not all leasing companies offer used car leasing. WCL will lease used cars dependent on the age and mileage.
In Ontario full disclosure leasing is a law. Your interest rate will be displayed on your contract for you to see.
Your lease may show up like any other payment obligation or it may just show up as a lien on your credit file
The residual value is part of the lease calculation so you will know the residual value when you negotiate your lease
A money factor is not used very much with most leasing companies preferring to show the APR on their lease. You can ask what the interest rate is being used to calculate your lease. WCL will show this on any quote it provides
In a loan you pay interest on the total amount financed or lease. So you will pay interest on the total amount of the lease not the difference between the amount financed and the residual value. This is the same basic premise as a loan or mortgage.
You can lease a vehicle for as little as 12 months and as much as 60 months depending on your need and your budget.
In Ontario there are no lemon laws. There is an arbitration process that you can follow if you have a problem vehicle. All automotive manufacturers cover this in their warranty information
You are required to have full insurance coverage on a lease, no different than a bank finance, this means liability, collision and comprehensive coverage.
Yes you can buy extra mileage up front, we allow for mileages up to 50,000 km per year. It is cheaper to pay them up front than at the end of the lease.
A down payment is usually used to lower the monthly payment. This means you will have used up the down payment over the term. If you paid a security deposit you may be entitled to get this back at the termination of your lease
Yes you may be able either refinance or release your lease. We offer both options.
If you can claim any portion of your vehicle for business then you may be able to write off your lease. Check with your accountant to be sure.
With interest rate so low you may want to explore both options and see what will give the best payment. A longer term finance even at a lower rate can cost more than a shorter term lease.
Right now! Leasing a vehicle is a great idea any time. You could argue that the BEST time may be 5 minutes to closing time, on New Years Eve, during a snow storm. But the real answer is anytime.
The better brands have a good resale value. They will give you the best lease value as they will have a higher residual value.