Protect Yourself When Buying a Used Car in Alberta

There are two ways to purchase a used vehicle – privately, or through a dealer. Either way, there are some steps you should take to make sure that the vehicle you are buying is worth the investment. It will cost time and money to research the vehicle properly, but a vehicle is a huge investment so it’s worth it in the long run.

Choosing a seller

Licensed Dealers are regulated by AMVIC (the Alberta Motor Vehicle Industry Council). If you are going to purchase from a dealer, we strongly urge you to check with AMVIC to make sure that your dealer is in good standing. These dealers have to comply with regulations which will protect you and make sure that the vehicle you purchase is what they tell you it is and that it is safe and road-worthy.
Note that not all dealers are licensed. Unlicensed automotive dealers (called “curbers”) may look like legitimate auto dealers, or they may pose as individuals selling a single vehicle privately, but they often make a profit by mis-representing the vehicle. They may sell you a vehicle that has been in an accident, requires expensive repairs, or has had the odometer rolled back.
If you choose to purchase a vehicle privately, be sure to do your due diligence and trust your instincts. Buying a vehicle is a huge investment and you don’t want to get stuck with a lemon.

Verify the VIN and Registered Owner

It’s important to physically verify the VIN. We suggest that you do this by looking at the VIN plate on the dash and comparing it against the VIN label on the driver’s door. Use your phone to take a photo of it and make sure that the two labels match. Make sure that the label does not appear to be damaged – if it is, it could be a forged VIN label and the vehicle may be a stolen “cloned” vehicle.
It’s also a good idea to verify that the seller is the current registered owner. You will have to do this by asking the owner to show you their Bill of Sale. You can also ask to see their registration certificate, although technically speaking this is not proof of ownership.
Unfortunately, we cannot verify the ownership of the vehicle in our office, due to privacy restrictions. If the vehicle is currently registered but the owner has misplaced the registration certificate, he or she will need to visit our office in person to request this or provide you with a completed, original Vehicle Authorization form authorizing you to get a duplicate registration.

Get a Mechanical Inspection

If you are purchasing from a licensed dealer, they will be required to complete a mechanical inspection and to provide you with a Mechanical Fitness Assessment (MFA). This assessment has to be recent (within the past 120 days). Be sure to read it carefully – the mechanic may indicate areas where the vehicle needs mechanical work to become road-worthy. The MFA is just a report card – it is not a certification of the vehicle’s mechanical condition.
Even if you purchase a vehicle with a MFA, Steve Ryan with Ryanco Automotive still suggests that you invest in a pre-purchase inspection. They offer a 130-point inspection for $130, which Ryan says is far more exhaustive than the basic MFA that a dealer will provide you with. Plus, if you take it to your own mechanic, you know you are getting an unbiased second opinion. If you are purchasing the vehicle privately, it is even more critical that you take the vehicle to a certified mechanic for a full inspection.

Ask Good Questions

Regardless of who you are buying the vehicle from, you should ask:
1. What is the history of the vehicle?
2. Which other provinces has the vehicle been registered in?
3. Has the vehicle ever been in an accident?
4. Has the vehicle ever been written off?
5. Who are the previous owners of the vehicle?

Stolen Vehicle Search

It is free to search the VIN online with the Canadian Police Information Centre (CPIC) database to see if the vehicle has been reported stolen. Since this search costs no money, it’s a great first step to do before you invest in any further vehicle reports or inspections.

Vehicle Information Report

The Vehicle Information Report is a compilation of information from the Alberta’ motor vehicle database which we are legally allowed to provide to a third party.

This information includes:
– Vehicle description (make, model and year)
– Vehicle status (active, salvage, etc.)
– How many times it has been registered in Alberta
– If there is a lien registered against it in Alberta (no details are included)
One thing to note is that it is our experience that if there isn’t an exact match with the VIN, the lien search information may not be 100% accurate. What this means is that there is a possibility that a lien could exist which does not show up on the VIR.
The cost is $26.38 plus GST.

Lien Search

The above questions are a great starting point and may help you to narrow down the reports you order on the vehicle, but unless you are buying a vehicle from your Grandma (and you know she purchased it brand new from a dealership), you should at a minimum do a Lien Search.
Sometimes people lease a vehicle from a dealership (even used vehicles may be leased) or borrow money from a bank or another lender in order to pay for the vehicle. In these cases, the creditor will take the vehicle as security and place a lien against the vehicle so that if the debtor defaults on the loan payments, the creditor has the right to repossess the vehicle.

You can now do an online Lien Check for the same cost as in our office ($16.75) and the results are instant.

We highly recommend doing a lien check before you purchase a pre-owned vehicle, as the risk to you is great if you shell out thousands for a vehicle with a lien against it. It will save you a lot of money in the long run if it turns out that the person you are buying the vehicle from still owes money and has used the vehicle as security against the loan.

CarProof

We are also able to order and print  CarProof verified reports in our office, at a cost of $80.80  including BC or $59.80 without BC. This will tell you if there are any liens on the vehicle, as well as import history, accident, collision and damage detail history, where the vehicle has been registered (US and Canada) and whether there are any safety recalls or stolen vehicle reports on the vehicle. The CarProof Report is the most comprehensive report you can buy on a vehicle and we do recommend it to safeguard your purchase.

Complete a Bill of Sale

We recommend that you use the Government of Alberta’s Bill of Sale form. It is legal to write out the pertinent details on paper, but the official Bill of Sale has all the pertinent identifying information that protects the buyer. It is important to note that the Bill of Sale must be original, complete and it can’t contain white out. If you need to correct a mistake, please cross it out neatly and then have both the buyer and the seller initial it. This form is available in our office free of charge, at the forms table under the “Road Test” sign.

Register the Vehicle

In order to register the vehicle, you will need to show valid proof of insurance (pink card – paper or digital copy) as well as proof of ownership (original Bill of Sale). If you have current insurance and registration with a valid plate on a vehicle in Alberta, you can use your existing plate for up to 2 weeks.