What is a bill of sale for a car?

What should appear on a bill of sale?

If you're creating a bill of sale form, check with your state Department of Motor Vehicles (DMV) to see what they require on the form. If you're buying from a private seller or selling the vehicle in installments, some states may also require a promissory note and the bill of sale. Here's a list of the most common items that may appear on the bill of sale form:

• Date of the sale
• Purchase price
• Payment details (paid in full or paid in installments)
• Odometer reading at the time of sale
• Model year, color of the car, and car make and model
• Year of manufacture
• Vehicle identification number (VIN)
• Type of body
• Number of engine cylinders
• A detailed description of the vehicle
• Warranties (is the car being sold "as is" or with any other terms and conditions)
• Names, signatures, and legal addresses of buyer and seller

Does a bill of sale need to be notarized?

It depends on the state. While some states allow the buyer and seller to complete a bill of sale on their own, other states require a notarized bill of sale. When you need a notarized bill of sale, the buyer and seller must meet with a notary public. A notary is a person the state has authorized to serve as an impartial witness to signing important documents. States generally regulate how much a notary public may charge for this service, often $10 or less. Your local bank may offer notary services for free to its customers. In addition, your local library may have a notary public on staff who can provide the service for free.

In the case of a bill of sale for selling a car, the notary public will likely verify the buyer's and seller's identities through a driver's license. They will also make sure the buyer and seller are both aware of all the terms in the bill of sale and are willing parties of the sale. Then the notary public will stamp the bill of sale with a notary seal and sign the bill of sale as proof of notarization.

How to get a bill of sale for a car

A seller usually needs a bill of sale for his or her own records. For states where you need a bill of sale for a motor vehicle as proof of purchase, you may have to use the official state DMV vehicle bill of sale form if they offer one. Some states let you draft a bill of sale yourself, and others give you the option of using an official form.

A buyer may need the bill of sale to complete a title transfer and to register the vehicle. Typically, the buyer will receive the bill of sale after the car purchase is complete.

Do I need a bill of sale when buying a used car?

A bill of sale is not required in every state. A bill of sale when buying a used car, however, is beneficial for several reasons. It serves as proof of the transaction for both sellers and buyers if someone tries to deny it. A bill of sale also serves as a release of liability for the seller. If the buyer gets into an accident with the car, the seller can use the bill of sale to prove they no longer own the car. The bill of sale proves that the seller is not legally responsible for any damage or injury the buyer might cause. It also protects the seller's auto insurance company from any accident claims.

For the buyer, a bill of sale helps establish proof of ownership and defines the car's condition at the time of purchase. If there's something wrong with the car that the seller did not disclose at the time of purchase, the buyer can use the bill of sale as evidence in any legal action they may take.

Why does an insurance company need a bill of sale?

A bill of sale shows that the car seller is not legally responsible for any damage or injury the buyer might cause. It protects the seller's auto insurance company as well from any accident claims.