Before you set out to sell your vehicle privately, there are certain steps you would be well advised to follow—to help ascertain its value, first of all, and also to lessen the chance of problems cropping up during or after the transaction.

Put together a record of the vehicle: gather all documents you have about the vehicle you are putting up for sale that might be useful to a potential buyer. These include the original sales contract, the warranty and maintenance manuals, repair bills, proof that any recalls were followed up, etc. A set of well-sorted invoices will, among other things, prove to your “customer” that your vehicle’s odometer displays the true distance travelled up to the present day. If your car has been in an accident, be up-front about it, and assemble any documents that may help you provide complete and appropriate information about it.

What about getting an inspection? Excellent idea: not only will an inspection help you better inform the buyer, but it will also help you set a price that reflects the true condition of the vehicle, based on the expert opinion of a neutral third party. You can also ask your mechanic to provide a written report on your automobile, a copy of which you can provide to the buyer.

A clean car is more likely to sell: take the time to buff up your vehicle to its original lustre—inside and out. Touch up the paint if necessary, get it washed and waxed, clean the rims, tires and hubcaps: whatever you can do to spruce up the car’s appearance will pay dividends!

Decide on a fair price: this, of course, is a touchy issue. If you demand too high a price, you probably won’t sell the car. Go too low with your asking price, and you’ll sell—but at a loss. What to do? Start by getting an idea of what the “competition” is up to. You aren’t the only person selling a car: go through the classified ads to find out the approximate value of a vehicle in the same age and condition as yours. Next, find out the “book value” for the make, model and year of your car. If you’re a member of CAA-Quebec, you have access to a variety of trade publications that list prices. All this should give you a good idea of how much to ask. Your mechanic, who knows your vehicle well, can also give an opinion on a fair price.

Remember that honesty is the best policy. When a potential buyer phones or comes to see the car, answer all questions asked of you to the best of your knowledge. Allow all prospective buyers to test-drive the car and have it inspected.

Do you need a contract? Under the law, you are not required to draw up a contract of sale, but to avoid misunderstandings, “getting it in writing” is the best way to go. CAA-Quebec can provide members with standard contracts that are easy to fill in. The basic elements to be included in any contract are as follows: names and addresses of the seller and buyer; description of the vehicle (including serial number, make, model, year, etc.); warranty (if applicable); statement that the buyer has examined and/or test-driven the vehicle and/or had it inspected; known problems and/or repairs to be done soon; proof that the car has been fully paid for by the seller; whether the vehicle was involved in an accident; and so on. It’s also a good idea to specify the conditions for the buyer taking possession. To make sure the buyer doesn’t have a change of heart and decides to leave you in the lurch, ask for a down payment. Make it non-refundable, and include a provision stating that if payment has not been made in full and the transfer of ownership completed by a certain date, the sale will be null and void and you will be free to sell to another buyer. When it comes to the actual payment, you can ask that it be in the form of a fund transfer, a certified cheque or bank draft, or cash.

Are you required to provide a warranty? The Consumer Protection Act does not apply to private sales; only merchants are required to declare warranties, on vehicles less than five years old and with fewer than 80,000 kilometres on the odometer. The Civil Code of Québec, however, states that the buyer must warrant to the buyer that the item sold is free of latent defects. The Civil Code defines latent defects as those that render the property for sale “unfit for the use for which it was intended or which so diminish its usefulness that the buyer would not have bought it or paid so high a price if he had been aware of them.” The warranty applies to the property sold as well as any accessories. An apparent defect is one “that can be perceived by a prudent and diligent buyer without any need of expert assistance.”

What about taxes? In a private sale, only the Quebec Sales Tax is charged, and it is applied by your local office of the Société de l’assurance automobile du Québec. In other words, you are not required to collect the tax yourself. In the case of a trade-in sale at a dealership, both GST and QST will be charged, but here again, you do not have to collect these amounts yourself.

© CAA-Quebec
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