Before you sign

After you have done all the research you can and made a decision on what vehicle you want, be sure to take these extra cautionary steps before you sign on the dotted line.


AMVIC can investigate deposit-related complaints only if there is evidence that the consumer was misled or there was an unfair practice. Remember that a deposit agreement is not a bill of sale.

Before handing over a deposit:

  • Consumers need to ask questions and make informed decisions before agreeing to a deposit.
  • Consumers should never have to give a deposit in order to test drive or negotiate a price for a vehicle. If there is no sales agreement, there should be no need for a deposit.
  • Always have a written sales agreement before paying a deposit.
  • Clarify the reason for a deposit. Is it a deposit or is it a down payment?
  • Make certain the sales agreement clearly states whether the deposit is refundable or non-refundable and under what terms and conditions.
  • Get a receipt for the deposit.
  • Generally, if there is no bill of sale and a vehicle is ordered with an in-house deposit agreement, which can vary greatly, the automotive business can ask for more money.
  • Consider using the recommended (optional) deposit form.

Reading the contract

It’s easy to get caught up in the excitement of buying a new car or RV. Before you enjoy that new ride, take the time to consider the details of your major purchase. Remember, you should never feel rushed or pressured to make a deal.

Read and understand documents:

  • Read every word in a document. If it requires a signature… it is important!
  • Documents that are used as sales tools or are created during the negotiation process such as worksheets, in-house deposit agreements, deposit receipts and other documents are NOT a bill of sale.
  • Get all promises, as well as clarification on terms, conditions and price that are not clear to you in writing. Use a fully completed bill of sale, not just a deposit agreement, that includes all of the mandatory information to best protect yourself from price increases.
  • If necessary, ask for help from a trusted friend or relative.
  • Never be in a rush when you are purchasing a vehicle. Take your time.
  • Stop shopping after you sign a purchase contract. When you buy a vehicle, there is no “cooling off” period. Even if you “find a better deal,” or “change your mind” a dealer can enforce the contract.
  • The only way you can cancel the contract is if the seller has a policy that says you may. Even if the seller agrees to cancel the contract, it may keep any deposit you have made. Before you buy, find out what the seller’s policy is and get the details in writing.
  • Has the vehicle history been disclosed to you including past damages over $3,000? Use the consumer guide for used vehicle purchase to ensure all relevant history has been disclosed.
  • Get a bill of sale and review it to be sure all information is accurate and complete. Use a vehicle purchase guide to ensure the bill of sale contains all the relevant information.
  • Verify the details of the finance agreement and be sure all reported income and down payment amounts are correct.


  • New vehicles are sold with a manufacturer’s warranty.
  • Many used vehicles are sold without warranty which means you could be responsible for the cost of any repairs.
  • The terms and conditions of a warranty are usually outlined in the agreement.
  • Make sure that any warranty is in writing and read it carefully. You need to know what your responsibilities are under the warranty. If you don’t perform them, will claims be denied? It’s wise to keep all maintenance or warranty work orders in case you need proof work was done.
  • If you are buying a used vehicle from an automotive business, check to see if there is any manufacturer’s warranty remaining on the vehicle. If not, see if the automotive business offers any warranty.
  • Not all warranties are the same and many are “limited.” You need to find out what the warranty covers and for what period of time, what it doesn’t cover, and what responsibilities you will have.
  • Some automotive businesses offer “extended” warranties (which increase the period of time you are covered under a manufacturer’s warranty) or “third-party” warranties (which are offered through warranty companies). Extended and third party warranties are generally available at an additional cost. Again, make sure that you understand the terms and conditions of such warranties and get, in writing, any details of what is covered and for how long, what’s not covered, and what your responsibilities are.
  • If the vehicle is five years old or newer and you have a dispute with an automobile manufacturer about the quality of your vehicle, or how the manufacturer is interpreting or implementing its new vehicle warranty, the Canadian Motor Vehicle Arbitration Plan (CAMVAP) may be an option for you. It is a program that resolves these types of problems through binding arbitration rather than court action. Many domestic and imported passenger cars, light trucks, sport utility vehicles, vans and multi-purpose passenger vehicles that are purchased or leased in Canada are covered by CAMVAP.