Selling Your Car on Consignment in Ontario: Check What You Will Actually Receive

A dealer offers to advertise your car, handle enquiries and find a buyer. That can save work, but leaving the keys is not the same as selling the car to the dealer. On consignment, the business is selling on your behalf; you need to understand the arrangement before handing over the vehicle.

Start with the amount you will receive, not just the advertised price. Clarify every deduction, who can approve a lower offer, how the money is handled and what happens if the vehicle does not sell.

1. Identify the business and the kind of deal

Verify the dealer through OMVIC’s official registration search, linked from its consignment guidance. Match the registered business with the name and address on your agreement. Do not rely only on a showroom sign or a social-media account.

Ask whether the offer is an outright purchase, trade-in or consignment. Those are not interchangeable. If it is consignment, read the complete agreement before leaving keys or signing transfer paperwork. Get independent advice if the document seems to authorize more than the sale you intended.

2. Put the essential terms in writing

For an Ontario consumer consignor, OMVIC’s requirements include a signed agreement identifying the parties and vehicle, distance information, itemized charges, estimated and minimum selling prices, the contract term, and applicable early-termination conditions or fees. The arrangement must be identified as consignment, with obligations stated clearly. Obtain your signed copy immediately.

Check the VIN yourself and correct errors before signing. Have the dealer explain any blank, vague or conflicting term. “We normally do not charge that” is less useful than an agreement that clearly says what will be charged in your case.

3. Calculate net proceeds before comparing offers

Use this worksheet with the actual agreement: sale price − dealer fees − approved extra costs − applicable taxes on charges − lender payout = cash remaining to you. Confirm which items are already included so you do not subtract them twice.

For a simplified hypothetical example, a C$30,000 sale less a C$1,500 fee and C$300 of approved preparation leaves C$28,200 before any applicable tax on charges or outstanding loan payout. It does not leave you C$30,000. These are illustrative worksheet figures, not typical market fees or a tax calculation.

Ask the dealer to show a fully itemized example using your vehicle, fees and debt. Compare that expected net result with an outright-purchase offer on the same basis. Also consider the uncertainty of waiting for a buyer; an estimated sale price is not a guaranteed cheque.

4. Set limits for work, driving and price changes

Ask who may authorize detailing, repairs, inspections, advertising upgrades or transport. Specify which costs require your written approval and what you owe if the car never sells. Ask who can accept an offer below the agreed minimum, and how your approval will be documented.

Record the handover condition, odometer, keys and included accessories. Ask where the vehicle will be stored, who may drive it, and how test drives and any damage will be documented. Keep a dated copy of the vehicle inventory alongside the agreement.

Alberta’s AMVIC consignment checklist expressly addresses authorized repairs, liens, insurance and the minimum amount the owner receives. Those are useful questions to ask anywhere, but its Alberta-specific legal requirements and payment deadlines should not be imported into an Ontario contract.

5. Confirm insurance before the vehicle leaves you

Ask the dealer and your insurer or broker to confirm the arrangements for storage, test drives, theft and damage while the car is on consignment, including deductibles and who must report a loss. AMVIC specifically tells consignors to check the insurance question with the insurer.

Do not cancel or reduce your own coverage simply because the dealer has the keys. Describe the actual arrangement to your insurer and obtain confirmation of what you need. A promise that the dealership is “fully insured” does not explain how your particular vehicle or loss would be handled.

6. Understand the payment process and the unsold exit

OMVIC’s trust-account guidance requires a general dealer to place consignment proceeds in a separate trust account when the consignor is an individual who bought the vehicle for personal or family use. Ask how the sale proceeds, your payment and any lender discharge will be documented. Do not mistake a trust-account requirement for a promise that every dispute or business failure will be painless.

The Vehicle Sales Authority of BC warns that consignment carries risks, including potential loss of a vehicle or money owed if a dealer goes out of business. That is a risk warning, not a description of Ontario compensation eligibility.

Before signing, settle how you are notified of a sale, when you will be paid, and which statement and sale documents you receive. If the term ends without a sale, know when and how you can collect the vehicle, keys and records, and what agreed charges remain. Calendar the expiry date yourself.

Sources checked November 1, 2026. Ontario requirements are identified separately from other provincial guidance. Confirm the terms of your particular transaction before signing.