For example, if you're buying a car using financing, the complete purchase agreement can be framed as a bill of sale, although technically the transfer of title might not happen until all payments required under the loan are made. Be sure you also sign the title and the odometer disclosure statement, if necessary, to prove you’re transferring ownership of the vehicle.Ī bill of sale can also be used in an auto loan agreement. When selling your car to a private individual, a bill of sale acts as a safeguard in case the buyer scams you and doesn’t transfer the title out of your name.Ī bill of sale shows that you are no longer the owner and are not responsible for any collisions, crimes, or parking tickets after the date of sale. You need to follow up by notifying your state’s Department of Motor Vehicles (DMV) or equivalent that you have sold the car. While a bill of sale doesn’t guarantee that the buyer will transfer the title and register the vehicle, it does prove that you are no longer legally responsible for the vehicle. The certificate of title is an official legal document, but the buyer takes that with them-meaning that you won’t be able to use the title to prove that you sold your car.

Similar to the receipt you receive from every other transaction, a bill of sale provides evidence that you signed a contract with the buyer. In some cases, warranty information might also be included.Įach state might have different requirements for what must be included in a bill of sale, but typically, the document will include the date of the sale, the names and addresses of the buyer and seller, a description of the asset being transferred, the amount being paid for the asset, and a guarantee that the asset is free from all claims and offsets. In some cases, a bill of sale may also be required in order to obtain insurance for the new owner. The asset could be a vehicle, boat, piece of equipment, or any other type of personal property.Ī bill of sale provides proof of ownership and can be used to register the asset with the new owner with the appropriate authorities. What does a bill of sale means? What Is a Bill of Sale?Ī bill of sale is a legal document that records the transfer of ownership of an asset from one person to another. What are the different types of bill of sale? What are the state-specific requirements for a bill of sale? What is the purpose of vehicle bill of sale? See why you should consider using a bill of sale for your next used car sales experience and how PrivateAuto makes the bill of sale process easy. While not required by every state Department of Motor Vehicles or DMV, this legal document protects you from liability. A bill of sale for car transactions verifies that you sold your vehicle to a buyer.

Free basic bill of sale