A motor vehicle bill of sale is a legal document that proves you are the owner of said vehicle. This form tells your local, state Department of Motor Vehicles that a sale transpired, and you are the legal owner. This receipt of purchase will vary from state to state, so it’s good to look up the particular requirements for each state. No matter what the state, both buyer and seller need to have a copy of the bill of sale.
What is Included?
As previously stated, each state may have its own particular requirements. However, there are basic elements which you’ll find on each bill of sale form, and these include:
The date of the sale: This is the day you made the formal transaction.
VIN: This is the Vehicle Identification Number and can usually be found inside the driver side door jamb, on your insurance form or from your vehicle’s manufacturer. No matter what make, model or year, the VIN will have the same characteristics. It’s a serial number that relates where the car was manufactured, the make, model and year of manufacture.
Vehicle information: This is the make, model and year of the vehicle
Trade-In: This involves the act of trading one vehicle for another. The monetary value of each vehicle will be stated and agreed upon by both parties involved in the trade.
Price Paid, Form of Payment, and Sales Tax: The exact amount you paid for the vehicle or its purchase price. Separate from the purchase price is the added state sales tax. The form of payment simply refers to how you paid for the vehicle: Cash, money order, credit, and so on.
Property: If your bill of sale has this section, then you are to specify certain particulars such as any warranty information, or as-is status. It states that the buyer has had ample time to inspect the vehicle in question before purchase. Details in this section may include the vehicle’s overall condition, odometer reading, license plate number and 17 characters VIN.
Location: This refers to the geographical location of the point of sales, such as city, state, and zip code.
Contact information: The names, addresses, and signatures of both buyer the seller.
Witness or Notary Public: Not every sale will have this, but if you plan on having the bill of sale notarized, or witnessed, their names and contact information will go here.
As-Is: We all know what “as-is” means in regards to an everyday purchase, and the same applies to your vehicle. This is a clause in your bill of sale in which the seller tells the buyer that the vehicle is sold as-is, so it’s their responsibility to make sure the condition of the vehicle is up to par.
Bill of Sale Forms (by State)
What is the Difference Between a Bill of Sale and Title Transfer?
A bill of sale is evidence that a transaction occurred, while a title transfer proves ownership and protects the new owner from any future liability. The bill of sale has the name and contact information of the buyer and seller, as well as the date of the transaction, VIN, price, model, make and year of the vehicle. The title, on the other hand, shows who the current owner of the vehicle is.
Please note that the title is relevant to the requirements of the state the owner of the vehicle resides in. If the owner lives in Alabama, then the vehicle title will be following the requirements of ownership of Alabama. In short, the bill of sale does not prove ownership; it just provides the details of the transaction, whereas it’s the title that proves ownership of the vehicle. So, once the bill of sale is complete, both buyer and seller must next complete a title transfer.
Benefits of a Bill of Sale
The bill of sale provides some important benefits for both buyer and seller. For buyers, they have a record of the transaction and all the details therein. This also makes it easier to register your vehicle in your state. While not necessary, it is recommended that the buyer bring a copy of what their state requires in a bill of sale during the official transaction. This ensures that the bill of sale provided by the seller has all the essential elements.
For sellers, start by checking with your state’s bill of sale requirements. If you happen to live in a state that does not require one, it’s strongly suggested that you make one up anyway for your records. It’s evidence that you unloaded the vehicle onto someone else, and it’s no longer your responsibility. This is especially important if the new owner gets themselves in a scrape, such as has an accident.