Motor vehicle sales contracts and cooling off

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ConsumerMotor industry

Need to cancel a contract to buy a vehicle?

If you need to cancel a contract to buy a vehicle you may be asked to pay “pre-estimated liquidated damages”. From 1 January 2022, the maximum amount of pre-estimated liquidated damages that a dealer may charge is five per cent.  Find out more information on Cancelling a contract to buy a vehicle with a dealer.

Whenever you buy a motor vehicle from another person or dealer, you and the seller enter into a contract for the purchase of that motor vehicle. The contract sets out your agreement.

When you buy from a dealer, you will have to sign a written document called a "Contract to buy a motor vehicle".

This document will describe the vehicle that the dealer has promised to sell to you and will contain a list of 'conditions', which describe what the buyer can do if there are problems with the contract or delivery.

These conditions are generally identical on every contract. You will find them on the back of the contract and they spell out how the contract deals with things such as:

  • Finance requirements
  • Delivery date
  • Changes in purchase price (for new vehicles)
  • Rights to terminate the contract.

The law says you must be given a copy of the contract at the time you sign it.

For the contract to be binding you must sign it and the dealer must advise you (in person, by phone, in writing, by fax or email that the contract has been accepted.

You can withdraw from the contract at any time before you are told by the dealer that the contract has been accepted.

At the moment there is no 'cooling-off' period for vehicle contracts in Western Australia.

If you are unsure about your rights under the contract you should contact our call centre on 1300 304 054.

A contract to buy a vehicle privately does not have to be in writing to be enforceable.

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