by Armando Martinez
If you're planning to sell your car soon, you need to know how to write a bill of sale. A bill of sale is a legal document that outlines the terms and conditions of your deal with the buyer. It also includes other details, such as the seller's and buyer's personal information, the sale's date, the vehicle identification number (VIN), and the odometer reading.
You can use the bill of sale as proof of the vehicle sale. It's not a requirement in every U.S. state, but you must know how to create one to eliminate any misunderstanding with the private party. You may also need the bill of sale when buying or registering a new car.
Many states provide a bill of sale on their own. If yours doesn't, you can write the document by yourself too. This post discusses everything you need to know about the private party car bill of sale, so keep reading till the end!
What Is a Private Party Car Bill of Sale?
A car bill of sale is a receipt or document that authenticates the transfer of ownership from the seller to the buyer. It also includes basic information about the buyer, the seller, the agreement between them, and the vehicle. The bill of sale is also known as a sales slip, sales recipe, proof of payment, auto bill of sale, as-is bill of sale, or proof of purchase.
When selling your car to private parties, you need to know how to write a car bill of sale. The document will serve as legal proof that both buyer and seller were on the same page at the time of sale.
A bill of sale is critical, especially if you plan to buy a new car. Many states in the U.S. also require citizens to show the bill of sale at the time of registration of a new car. You can check with your local administration to know whether your state requires it.
Why a Bill of Sale Is Beneficial in a Private Party Transaction
A bill of sale records any type of personal property or asset transfer from one party to another. This primarily includes your vehicles, livestock, or any electronic item. The car bill of sale document outlines the payment terms, warranties, and the car's condition. This way, it acts as legal evidence of the agreement.
Typically, the seller creates the document and includes all the crucial information about the sale. So, if the private party raises any conflict about any term of the agreement, you can use the bill of sale to show them that they agreed to it.
If the buyer takes the dispute to court, the honorable judge will review the bill of sale to make the decision. Also, in case the vehicle gets involved in an accident, you can use the bill of sale to prove that you are no longer its owner.
When transferring a vehicle title with your state’s department of motor vehicles (DMV), you might need a signed bill of sale to complete the process. The document is also beneficial from the buyer's point of view. It helps them keep a record of their new vehicle purchase.
States Where a Vehicle Bill of Sale Is Required
A private party car bill of sale is a requirement in only 16 U.S. states. You’d have to check your state’s DMV website to find the official car bill of sale word template. Simply download the form, fill it out, and submit it. If you find the form from any other source, ensure it is the official DMV bill of sale document.
You must also check your state’s requirements when preparing the bill of sale. Some states require the bill of sale to be notarized or signed by a notary public to ensure its authenticity. The states where a vehicle bill of sale is required include the following:
- Alabama
- Arkansas
- Colorado
- Connecticut
- Hawaii
- Idaho
- Maine
- Nebraska
- New York
- Ohio
- Rhode Island
- South Dakota
- Vermont
- Washington
- West Virginia
- Wyoming
The states that only accept a notarized car bill of sale are:
Whether your state is included in the above list or not, consider creating a bill of sale as an additional safety protection. It will also help you stay ahead of all future misunderstandings or mishaps.
What Details Are Included in a Car Bill of Sale?
A car bill of sale is a comprehensive legal document. As a seller, creating a call bill of sale is primarily your responsibility. However, you must also consider the buyer's consent when creating the document.
An ideal car bill of sale template consists of the following details:
Date of the Sale
This is the exact date the car owner loses their vehicle ownership and transfers it to the private party. The buyer and the seller usually sign the contract after agreeing upon the vehicle’s purchase price, the mode of payment, and the car’s condition.
The date on which the buyer makes the transaction and signs the contract is the actual date of the sale. It goes in the car bill of sale.
VIN
The vehicle identification number or VIN is your car’s fingerprint, which is unique for every vehicle. The VIN consists of 17 characters, including digits and letters. It displays a vehicle's specifications, manufacturer, and outstanding features.
To know a car's history, you can use the VIN to track its previous warranty claims, insurance coverage, recalls, accidents, repairs, theft, and registrations. This makes VIN a vital component of the private party car bill of sale.
Vehicle Descriptions and Details
While including a VIN is crucial, sometimes, it may not provide the minute details and descriptions of the car. Other times, it can be impossible for the buyer or the seller to look up the VIN on the internet.
So, the car bill of sale must include the following essential details about the vehicle-in-deal:
- Year, make, and model
- Current mileage (the number of miles a car has traveled in its lifetime)
- License plate number
Vehicle Selling Price and Payment Details
You need to mention the car’s sale price and the mode of payment you agreed on with the buyer. Generally, there are two types of payment in the car sale business: installment and lump sum. Regardless of the payment method you agreed upon, mention it clearly in the car bill of sale document.
Many car owners are also confused about writing a bill of sale for a car they received as a gift. If you sell a car that was a gift or a partial gift, you must create its bill of sale document and mention the reduced price (if any).
Warranty Information (if Applicable)
Many car bill of sale documents include the warranty information of the item in exchange. However, this is not the case with most private sales. Instead, these transactions are considered “as is,” which entails no warranty.
If the seller and the buyer agree upon something different, they must put it in the vehicle’s bill of sale.
Odometer Disclosure
Every vehicle has an odometer, an instrument measuring its total distance traveled. Remember that the odometer reading and mileage are two different things. An odometer reading is actually the distance a vehicle has traveled. On the other hand, mileage is the total fuel consumed by the vehicle per mile.
A private party car bill of sale also includes the odometer statement. You must check the vehicle’s odometer at the date of the sale and note its mileage. The distance your car has traveled will help you find out its mileage.
Terms and Conditions of Sale
During the car sale, the seller and the buyer agree upon many things. However, there is no weight to these terms and conditions until or unless they are written down.
Ensure your car bill of sale includes all the terms and conditions of sale. Also, use terms like the car being sold “as is,” which means you take no guarantee of the vehicle’s performance or condition.
Names, Addresses, and Phone Numbers of Buyer and Seller
The buyer and the seller must also include their personal information in the car bill of sale. This verifies that the deal was made between two authentic parties who willingly agreed to trust each other with the money and asset.
Ensure that your private party car bill of sale includes the names, phone numbers, and addresses of both the buyer and the seller.
Buyer and Seller Signatures
The car bill of sale must end with the buyer and seller's signatures along with the time of sale. Above your signature, there will be a declaration acknowledging that you consent to this agreement and that the information you provided is accurate.
Once the buyer and seller sign, the document completes, and both parties receive a copy each.
Caramel Makes Private Party Paperwork Simple
Car selling and buying include a significant amount of paperwork. While the experience itself is exciting, you may feel overwhelmed by the constant paperwork hassles. If you don't have the time and energy to take care of your car's paperwork, you can trust a reliable platform like Caramel to do it on your behalf.
Once the private party buyer or seller finds the card listing they are interested in, they can move to Caramel and initiate the process. The platform will handle everything from there, including verification, paperwork, and anything in between.
This article was written by Armando Martinez. Armando Martinez is among the nation’s experts on automotive titling, registration, DMV services and document operations. With nearly two decades of experience across a broad range of financial services functions and some of the largest names in auto, from Wells Fargo to Uber, Armando combines vision and ingenuity with a wealth of information so auto shoppers and sellers can learn from his experience.
Start your transaction with Caramel, learn more about how the process works, or reach out to our Support team with any questions.
