IMPORTANT NOTICE: DO YOU OWN A VEHICLE
FOR MANY DMV SERVICES YOU MUST SHOW PROOF OF INSURANCE. RECENT RESEARCH SHOWS US DRIVERS ARE PAYING MORE FOR AUTO INSURANCE THAN WHAT IS REQUIRED BY THE STATE. SHOW PROOF OF INSURANCE AND SEE IF YOU WILL SAVE UP TO $500 PER YEAR!!

Why Do You Need a Bill of Sale?

A Bill of Sale is often needed as a legal document record of a vehicle transaction. While not mandatory in every state, this document should be kept as a copy by both the buyer and seller, which can serve as protection in the future.

For sellers, the state in which the vehicle is sold may require that a Bill of Sale be provided to the buyer and when filing for a title transfer. Certain states may also require the Bill of Sale to be notarized. Having this record can serve to help sellers in the event that a buyer commits a driving violation while the title transfer is being processed. In this scenario, the Bill of Sale proves that the vehicle had been sold and therefore the seller cannot be held responsible for the vehicle afterward.

For buyers, a Bill of Sale can serve as a binding contract that the vehicle is accepted as-is upon purchase. Because of this, it is recommended that buyers fulfill thorough vehicle history reports and agreed terms before signing a Bill of Sale. This will also make the new owner vehicle registration process proceed more smoothly and can prevent buyers from discovering unreported issues after purchase.

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Information and Instructions on Bill of Sale

Filling out a Bill of Sale requires straightforward information about both parties to provide documented proof that a sale transaction was made. In most cases, necessary documents required involve driver's licenses, proof of insurance and title paperwork.

Checklist of Bill of Sale Information

  • Year and make of the vehicle, including model and body type
  • Vehicle identification number (VIN)
  • Date and location of sale
  • Purchase price
  • Names, addresses and signatures of both the buyer and seller
  • Odometer Disclosure Statement

Additional Information That May Be Required

Certain states may need more than the above general requirements to approve a Bill of Sale. This information may include:

  • Seller's representation and warranties
  • Buyer's representation and warranties
  • Warranty disclaimers
  • Mechanical inspection summaries
  • Terms on how the vehicle will be delivered
  • Date of when title transfer will be made into effect
  • Seller's agreement to cancel any insurance and tags on vehicle
  • Additional terms of sale

These additional section terms serve as added protection by providing more information on the vehicle being sold. Anything unreported that violates these terms may hold the seller liable for fraud. However, without additional terms specified, buyers may be held responsible for the vehicle after they sign a Bill of Sale, even if the seller omitted maintenance issues upon sale. It is therefore best to proceed with caution and consider including the additional information suggested above in the Bill of Sale.

What Do You Need for a State-Approved Bill of Sale?

In most cases, states with specific requirements will offer a free downloadable Bill of Sale form off their official DMV website for citizens to use. In other cases, sellers may use a general Bill of Sale form, such as the one attached to this guide, and alter or add details to meet state specifications.

Each state is different, so it is always advised to check if your Bill of Sale meets local standards. Some example of differences may include:

  • Sellers need to provide state-specific Bill of Sale within 30 days of selling the vehicle (applies to Missouri and Florida).
  • Both parties need a state-approved Bill of Sale on record, which allows for easy replacement in case they lose the document (applies to Connecticut).
  • Some states require a Bill of Sale if the vehicle is older than a specific date (applies to South Carolina and Maryland).
  • California requires a Bill of Sale when sellers junk their vehicles.

A common take-away is that even in states that offer specific Bills of Sale, they may not require a Bill of Sale in the first place. Utah, for example, allows citizens to write up their own Bill of Sale (it can even be handwritten), so make sure to read up on the requirements in your area.

Don't Want Any Hassle? Use a General Bill of Sale

As long as the Bill of Sale provides the right information about both parties, the vehicle and date of sale, many states will accept a general Bill of Sale as a legal record.

Use the Bill of Sale provided when filing for a title transfer or new title application for a quick, streamlined process. Each Bill of Sale should come with two copies, one for the seller and one for the buyer to use for their personal records.

Buying and selling a private vehicle doesn't have to be difficult. With the right preparation and paperwork, both parties can walk away from the deal with a sense of security and a good investment. For more tips on the vehicle sale process, read the next two sections to determine if you're ready to sign a Bill of Sale or need more time to secure your position.