A car sales contract is typically a sales contract that usually involves the buyer paying a certain amount of money, in a series of instalments, or at once. When instalments are involved, the buyer is able to take possession of a car and use it in exchange for meeting the requirements of a contract for regular payments on which interest is charged. Upon fulfilment of the instalment car sales contract, the seller typically gives the buyer the title to the contract. On the other hand, a car sales contract can also involve a full one-time payment – colloquially referred as buying cash – where the contract will describe the transaction taking place, list the conditions and warranties, if any. These two types are found both for used car sales contract and new car sales contract.
Like other forms of sales contract, one for the sale of a car involves a formal agreement on the part of both buyer and seller. The car sales process involves the drawing up of a sales contract or an instalment contract following an offer that has been made by the seller and accepted by the buyer. For an instalment car sales contract the buyer will have accepted both the cost of the vehicle and the annual percentage rate of interest to be charged. For a new or used car sales contract with a one time payment, the contract will indicate the method of payment and state that the buyer has fulfilled his part of the transaction.
Instalment Car Sales Contract
In Canada, the seller’s part of the bargain is to allow the buyer to possess and to use the car in the case of an instalment car sales contract. The buyer’s obligation is to meet the demands of the instalment contract in terms of regular payments. If the buyer fails to pay on time, the buyer can sue due to non-performance on the part of the contract that has been left unfulfilled.
The terms of a car sales contract will usually stipulate that failure to make an agreed payment can result in the seller suing for the full outstanding balance, and not just one missed payment. This is because failure to pay an instalment on the vehicle is construed as indicating that the buyer intends to default on the entire ‘loan’ involved in the contract.
Some car sales contracts may offer alternatives to those who find themselves unable to make their usual monthly payments, but since the cost of the vehicle and the rate of interest are usually set, it’s wise to give a lot of thought to this kind of legal contract before entering into it.
New and Used Car Sales Contract
In the case of a one-time payment of a new or used car sales contract, the seller’s obligation is to deliver the car in the condition stated in the contract. The buyer’s obligation is to pay whatever it has been agreed for the used car (or new).
From the buyer’s point of view, a car sales contract can have some advantages. Contracts typically provide for servicing costs and compensation for anything that goes wrong with a car while it still legally belongs to the seller. Contracts vary, and car sales contracts can be complex, so it’s always wise to make sure that everything is understood before signing.
New and Used Car Sales Contract Templates
If you’re looking for a new or used car sales contract template, which is also called a car sales agreement template, we suggest you visit LawDepot Canada. They offer various Canadian sales contract templates with guidelines and steps on how to fill them.