Car buyers are being urged to check vehicle sales contracts after Consumer Protection caught dealers using incorrect or outdated agreement rules.
Commissioner for Consumer Protection, Trish Blake said that since 1 January 2022, the maximum amount motor dealers could charge a consumer who cancelled a sales contract was five per cent of the contract’s value.
Previously, dealers could charge up to 15 per cent as “pre-estimated liquidated damages” (PELD).
Ms Blake said that recently a motor vehicle dealer in Perth’s northern suburbs was issued with two infringement notices after buyers signed outdated contracts which stated the old 15 per cent PELD fee.
“Since the reduction came into force, Consumer Protection has received 47 complaints in 2022 relating to disputes over fees charged after contract cancellations, which is double the number lodged in 2021,” Ms Blake said.
“Most complaints have been resolved with a total of $28,321.00 being recouped by consumers.”
She said with no cooling-off period for vehicle sales in the State, buyers should be certain before signing a vehicle purchase contract that they could afford it.
“If a buyer has paid a deposit and signed a document with the dealer, than this is a vehicle purchase contract,” Ms Blake said.
“This locks the buyer into purchasing the vehicle, subject to any special conditions, and they may not receive a full refund if they change their mind as PELD may be chargeable.”
However, she said dealers should not automatically charge the maximum five per cent fee, as the amount needed to realistically reflect the actual costs of the cancellation to the business.
