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Key takeaways
- Dealers cost more but offer licensing protection, warranties and easy financing.
- Online retailers deliver to your door and usually let you return the car within a set window.
- Private sales can be the cheapest option, but you take on all the risk. Always run a history report and lien check.
- Get pre-approved before you shop so you know your budget and can negotiate.
Quick comparison: where to buy a car
| Where | Best for | Price | Financing | Buyer protection |
|---|---|---|---|---|
| Franchise dealer | New and certified pre-owned | $$$ | Yes, including manufacturer rates | High |
| Independent dealer | Used cars, all credit levels | $$ | Yes, often subprime | Medium to high |
| Online retailer | Hassle-free used buying | $$ | Yes | Medium to high, with return window |
| Marketplace | Comparing lots of listings | $–$$$ | Depends on seller | Depends on seller |
| Private seller | Lowest price | $ | Arrange your own | Low |
| Auction | Experienced buyers | $ | Rarely | Very low |
Buying from a dealership
Franchise (new car) dealers
Franchise dealers sell new vehicles for one or more brands, plus trade-ins and certified pre-owned (CPO) cars. You get manufacturer warranties, recall work done before delivery, and access to promotional financing that can be well below market rates for buyers with good credit.
Independent used car dealers
Independent dealers sell used cars from many brands, usually at lower prices than franchise stores. Many work with lenders that specialize in fair and poor credit, so they’re a common choice if your credit is rebuilding.
Pros
- Dealers must be licensed by a provincial regulator, such as OMVIC in Ontario, AMVIC in Alberta or the Vehicle Sales Authority in B.C.
- Financing, trade-ins and paperwork handled in one place
- Warranties and inspected vehicles
Cons
- Higher prices than private sales
- Fees and add-ons (admin fees, protection packages, extended warranties)
- Sales pressure in the finance office
Tip: Several provinces, including Ontario, require all-in price advertising. The advertised price must include fees other than sales tax and licensing. If a dealer adds surprise fees, ask what they are for.
Online car retailers
Online retailers sell used cars entirely online. You browse, finance and buy on their website, and the car is delivered to your door or ready for pickup. Most offer a limited return window and a reconditioning or inspection report on every car.
Clutch
Canada’s best-known online used car retailer, with delivery in many provinces, inspected vehicles and a return window.
Canada Drives
Buy and finance a used car online, with home delivery in the provinces it serves.
Manufacturer online stores
Some brands, especially electric vehicle makers, sell new cars directly online at a fixed price.
Compare the total price, including delivery and admin fees, and read the return conditions. Most return windows end after a set number of days or kilometres.
Online marketplaces
Marketplaces list cars from dealers and private sellers in one place. They’re the best way to compare prices for a specific model in your area.
AutoTrader.ca
One of Canada’s largest car listing sites, with new and used cars from dealers and private sellers and price-comparison tools.
CarGurus
Rates each listing against similar cars nearby, from “great deal” to “overpriced”, so you can spot fair prices quickly.
Kijiji Autos
Lots of local dealer and private listings, popular for lower-priced used cars.
Facebook Marketplace
Many private listings and low prices, but the most scam risk. Never pay a deposit before you see the car.
Buying from a private seller
Buying privately can save you thousands because there’s no dealer markup. The trade-off is risk: no warranty, no regulator to complain to, and it’s up to you to make sure the car is safe and the seller actually owns it free and clear.
- Check for liens. If the seller still owes money on the car, the lender can seize it from you. Search your province’s personal property registry, or use a history report that includes lien information.
- Match the paperwork. The name and address on the ownership should match the seller’s ID.
- Know your province’s rules. In Ontario, private sellers must give you a Used Vehicle Information Package (UVIP). Some provinces require a safety inspection before the car can be registered.
- Pay safely. Use a bank draft or a transfer at your bank, and get a signed bill of sale.
Auctions, fleet and lease returns
Public auctions, including government surplus sales through GCSurplus, can offer low prices. But cars are sold as-is, often with no test drive, so they’re best left to experienced buyers. Many big auctions are dealer-only.
Rental fleet sales and lease returns are a middle ground. These are usually 2–4 year old cars with known maintenance histories, often sold through dealers as certified pre-owned.
Used car checklist before you buy
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Get a vehicle history report
A report from a service like CARFAX Canada shows accidents, registrations in other provinces, odometer readings and liens.
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Check for open recalls
Search the VIN in Transport Canada’s recall database or on the manufacturer’s website. Recall repairs are free at a brand dealer.
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Get an independent inspection
A pre-purchase inspection by your own mechanic usually costs $100–$200 and can uncover problems that cost thousands.
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Test drive it properly
Drive on the highway and in the city. Test the brakes, listen for noises, and try every feature, including heat and A/C.
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Know the total cost
Add sales tax, fees, insurance and registration. Use our car loan calculator to see the payment with tax included.
How to avoid car buying scams
Red flags:
- The price is far below similar listings
- The seller asks for a deposit, gift cards or crypto before you see the car
- They “can’t meet” and offer to ship the car
- The name on the ownership doesn’t match the seller (a possible curbsider)
- The VIN on the car doesn’t match the paperwork
Get pre-approved before you shop
Knowing how much you’re approved for before you visit a dealer or seller helps you stick to your budget and negotiate on the price, not the monthly payment. It also lets you compare the dealer’s financing offer against yours. If your credit needs work, see how to build credit for a car loan.
Car buying FAQ
Is it cheaper to buy a car privately or from a dealer?
Private sales are often cheaper because there’s no dealer markup, and in some provinces the sales tax is different. But you get no warranty, no dealer licensing protection and no built-in financing. You’re also responsible for checking for liens and mechanical problems yourself.
Can I finance a car I buy from a private seller?
Yes, but fewer lenders offer private-sale car loans, and they usually want a lien check and the vehicle’s details before they pay out. Getting pre-approved first tells you how much you can spend.
Are online car retailers like Clutch and Canada Drives legit?
Yes. They’re licensed dealers that sell used cars online, deliver them to your door and usually offer a return window. Read the return policy, the inspection report and any delivery fees before you buy, the same as you would at a regular dealer.
What is a curbsider?
A curbsider is an unlicensed dealer who pretends to be a private seller. They often sell cars with hidden damage, rolled-back odometers or liens. Warning signs: they list many cars, they want to meet somewhere other than their home, or the name on the ownership doesn’t match theirs.
Is there a cooling-off period when buying a car in Canada?
Generally, no. Most provinces have no automatic cooling-off period for vehicle purchases, so once you sign the contract you’re usually committed. Some online retailers and dealers offer their own return policies. Get them in writing. See our car financing laws guide for more.
What is a certified pre-owned (CPO) car?
A certified pre-owned car is a newer used vehicle sold by a franchise dealer that passed a manufacturer inspection. It comes with an extended manufacturer warranty, and sometimes special financing rates. It costs more than a regular used car but gives you more peace of mind.
Shop with confidence: get pre-approved first
Know your budget before you start looking. Financing for every credit score, with no impact on your credit to check your options.