How to Write a Bill of Sale for a Car (A Simple Explanation)
Many of us are used to purchasing vehicles from a dealership, but how do you handle the legal paperwork if you want to buy a used car from another individual? Or what if you’re planning to sell your own vehicle?
It’s important to have all the necessary documents on hand if you want to sell your vehicle. This often includes having the title of the car, but you might need a bill of sale as well, depending on the state you live in.
If your state requires it, it’s helpful to know ahead of time how to write a bill of sale for a car you want to sell. Even if your state doesn’t have a bill of sale requirement, it might still be a good idea to include one in the transfer of ownership.
Here’s what you need to know about what information is needed on a bill of sale and how you can create or obtain one.
In this article
- What is a bill of sale?
- Who writes the bill of sale?
- How to create a proper bill of sale
- What information needs to be on a bill of sale?
- Bottom line
What is a bill of sale?
A bill of sale is a document that provides proof of a legal transfer of the title of a car from one individual to another. It typically includes important vehicle information, such as the type of vehicle, license plate number, and vehicle identification number.
Many states require a bill of sale when you sell a car, but some states don’t. Depending on your state, a vehicle bill of sale may not be accepted by itself as proof of ownership, and other documents may be required.
It’s also common for bills of sale to include information about how much the vehicle is being sold for. The purchase price listed on a bill of sale could be used for sales tax purposes, which may be why some states require this document.
In some cases, your state laws may require a bill of sale and/or the original vehicle title to get your car registered and to receive license plates. As such, this is an important step to handle before making other decisions, like choosing a car insurance provider.
Who writes the bill of sale?
The writer of the bill of sale for a car depends on how the car is being purchased. If you’re buying a vehicle from a dealership, the dealership would write the bill of sale. If you’re buying a car from a private seller, the current vehicle owner would write the bill of sale and give you a copy when the transfer of the title is made.
If you’re selling a vehicle on your own as a private seller, you could be responsible for creating your own bill of sale as proof of purchase for the new owner. Therefore, it’s important to know how to sell your car and which documents you need to provide. It’s your responsibility to write a bill of sale if your state requires it or you want one for your own records.
How to create a proper bill of sale
If your state requires a bill of sale, your local Department of Motor Vehicles should have a bill of sale form available online for you to use. Even if your state doesn’t require a bill of sale, its DMV website might still have a form available online for you to use.
To make sure you find the correct bill of sale form for your state, go to your state’s DMV website and navigate to the forms section. Alternatively, you can do an online search for “car bill of sale [your state’s name].”
Official state DMV websites typically have “dmv” and the state’s initials or name in their website address and most of them will have a “.gov” ending. For example, the Utah DMV website is www.dmv.utah.gov, and the California DMV website is www.dmv.ca.gov. However, the Nevada DMV website is www.dmvnv.com and doesn’t have the .gov ending.
If your state doesn’t provide a vehicle bill of sale form, it’s easy to find templates online to use yourself or for inspiration in creating your own. Handwritten bills of sale are typically considered acceptable, though they should be written in ink instead of pencil.
Keep in mind that some states may require a bill of sale to be notarized. For example, if you look at the bills of sale forms provided by the Louisiana and West Virginia state governments, you’ll see a line on the form for a notary public’s signature.
This means a notary public must witness and sign the bill of sale for it to be considered legal. Notary publics are individuals appointed by the state government to serve as impartial witnesses in acts related to the signing of important documents.
What information needs to be on a bill of sale?
If you’re going to fill out a bill of sale or write one yourself, you’ll likely need this information on hand:
- Date of the sale
- Vehicle sale price
- Description of the vehicle you’re selling, including year, make, model, and VIN
- Buyer’s name and signature
- Seller’s name and signature
You may also be required to or want to include this information:
- License plate number
- Title number
- Odometer reading (mileage) or odometer disclosure statement
- Additional buyer information, including driver’s license number, address, and date of birth
- Additional seller information, including driver’s license number, address, and date of birth
- Terms of the sale
Is a handwritten bill of sale legal?
Yes, a handwritten bill of sale is typically considered a legal document when selling a car. However, you should check with your state’s DMV to be sure. Keep in mind that many states provide a free motor vehicle bill of sale form that you can use and you can typically find them online. In addition, many free bill of sale templates are also available online.
Who keeps the bill of sale when selling a car?
Both the buyer and seller of a car should typically have their own copy of the bill of sale once the transfer of ownership is completed. This makes it easier for both parties to have their own records of the transfer should they need this information for any reason down the road. For example, the new owner may need it to obtain their official certificate of title.
Should I sign a bill of sale before payment?
It likely doesn’t make sense to sign a bill of sale before receiving payment for the vehicle you’re selling. The best time to sell a car would be when you have an interested buyer who you know has the money you’re asking for.
The bill of sale is a record of a transfer of ownership, including any payments made for that transfer. If your bill of sale reflects that you should receive a specified payment for your vehicle, you need to make sure the payment is received before signing. This is to ensure you aren’t taken advantage of by finalizing the sale of the car to a new owner before you’ve received your money.
Bills of sale aren’t overly complicated and shouldn’t take more than a few minutes to fill out as long as you have all the necessary information. State governments often make the process easier by providing access to online forms you can use. But it’s a smart decision to provide a bill of sale for a car you’re selling, even if your state doesn’t require it, because it gives you a record of the transfer.
Besides being smart about selling a vehicle, make sure you have the right information if you’re shopping for a replacement car or have recently purchased one. Part of the cost of a new vehicle is getting sufficient car insurance so you have the coverage you need. But that doesn’t mean it has to cost a fortune To learn more about what’s available and compare providers, check out our list of the best car insurance companies.
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