Whether you are buying or selling a vehicle, having a copy of a bill of sale signed by both parties at the time of the sale will prevent any problems that may arise later on. The bill of sale acts essentially as a receipt or record of necessary information, including the names and addresses of both buyer/seller, date of sale, price, and vehicle information. The bill of sale combined with a registration certificate may be enough to prove ownership, if a valid title isn’t available. Local requirements will vary, so be sure to check with your local department of motor vehicles.
A bill of sale document lines out the details of a transaction between a buyer and seller. The seller’s bill of sale form will show the date the vehicle was sold and the buying party’s information. The buyer’s form will show specific information about the vehicle.
Having a bill of sale helps sellers with reporting taxes and provides “as-is” protection if no warranty is agreed upon.
For buyers, a bill of sale can help determine the Vehicle Registration Fee in some states.
While a bill of sale provides a legal proof of the sale agreement, it generally does not prove ownership of the vehicle. For that, a title transfer is required. In some cases, a bill of sale alongside a registration certificate can prove ownership. Some states have specific requirements as to what must appear on a bill of sale form for it to be accepted. Check with your local department of motor vehicles for verification.
Depending on the state, an odometer disclosure statement may be needed which could be a separate form or part of the state’s bill of sale form.
A title transfer proves ownership of a vehicle. Until this document has been completed, a sale cannot be considered final, and the seller may remain liable for any fines/violations associated with the car. Verify the VIN on the title to make sure it matches the actual VIN and that there are no liens.
A bill of sale is considered a legal document that is not as formalized as a title or deed, but represents a record of a sold vehicle. The form can be used as evidence that the transaction took place in the instance that a dispute arises regarding the details or conditions of the transaction.
Just like any other legal document, double check and understand all of the parts before signing. Since the seller provides the bill of sale, a buyer must read over the terms diligently.
Not all states require a bill of sale when buying or selling a car, but for a few of them it is required. If it isn’t required in your state, it is recommended that you fill one out anyways for your own records. This way you will have record of the date, price, and other details of the transaction. The following are states that require a bill of sale when buying or selling a car:
The following states have a specific bill of sale form when you buy or sell a vehicle. If you are completing a vehicle sale in one of these states, you can the download the bill of sale template offered by that state’s motor vehicle agency at the links below.
Most states don’t require you to have a bill of sale signed with the witness of a notary. Although, there are a few states that require you to do so:
If your state does not require or offer a bill of sale form, download our generic, printable bill of sale template:
If you are a buyer, it is always wise to order a vehicle history report to be sure you won’t be getting any unpleasant surprises later on. Vehicle history reports reveal details about a vehicle’s past, including:
Compare the details on the bill of sale with the vehicle history report so you don’t purchase a lemon. Alternatively, you can take the used car to your mechanic to ensure that everything will run smoothly and there won’t be any unexpected issues down the road.