How To Write a Bill of Sale:
8 Steps to Follow

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What Is a Written Bill of Sale?

A bill of sale, proof of purchase, proof of payment, or proof of sale, is a legal document that is used to transfer ownership and verify a sale. The document provides basic information about the property or object being sold. Bills of sale are not required by all states but are generally important to prevent future misunderstandings between the seller and the buyer in a transaction.

A bill of sale serves as legal evidence that the seller has transferred ownership of an asset to a buyer.

How Do You Write A Simple Bill Of Sale?

Some states provide a free template or sample bill of sale form. However, even if your state doesn’t have a sample bill of sale format, there are a few components common to all bill of sale documents.

Writing a Bill of Sale – Step by Step

  1. Date of the sale : Your bill of sale document should mention the date of the sale.
  2. Description of Item : Your bill of sale should describe the item being sold in detail. For instance, if you are selling a car, your bill of sale should mention the year, make and model, vehicle identification number, current mileage, and license plate number.
  3. Selling Price : Your bill of sale should also state the price the item is being sold for. If your item is a gift or a partial gift, the bill of sale can state the reduced price.
  4. Warranty : Private party sales are generally considered “as is” sales or ones without warranty. If your agreement does have a warranty you should put it in the bill of sale document.
  5. Parties Involved : Your bill of sale document should include the names, addresses and signatures of the buyer and the seller. It should also contain signature above the statement acknowledging that both parties have provided true and correct information best of their knowledge and belief.
  6. Previous Owners : The bill of sale, in case it is a private sale of a used property, such as a used car, should name previous owners known to the seller.
  7. Payment : The bill of sale document should also state the method of payment used such as installments or in full, cash, check, credit card or bank deposit.
  8. Other agreements : The bill of sale should also state other agreements regarding the sale, such as due dates for pending payments, late payments, interest rates, etc.

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Key Terms to Include in Your Bill of Sale

A bill of sale is a written contract verifying the transfer of ownership of an item being sold. There are some common terms used in a bill of sale across jurisdictions. Your bill of sale should include the following terms:

  • Seller name: Name of the parties is required and you should mention the full name of the seller.
  • Seller address: Your bill of sale should include contact info of the seller, such as the address.
  • Selling price: Your bill of sale should clearly state the selling price of the item to avoid any discrepancy.
  • Sale date: Your bill of sale should mention the exact date of the sale and when the transfer of ownership would be effective.
  • Buyer name: Your bill of sale document should mention the information about the buyer as well, such as their name.
  • Buyer address: Your bill of sale document should mention the address and contact information about the buyer.
  • Vehicle name (in case of a vehicle sale): In case of a car sale, the bill of sale should include the name of the vehicle.
  • Body type (in case of a vehicle sale): In case of a car sale, the bill of sale should include the body type of the vehicle.
  • Vehicle year ( in case of a vehicle sale): In case of a car sale, the bill of sale should include the vehicle year of the vehicle.
  • Title number (in case of a vehicle sale): In case of a car sale, the bill of sale should include the title number of the vehicle.
  • VIN (in case of a vehicle sale): In case of a car sale, the bill of sale should include the VIN of the vehicle.
  • Odometer reading (in case of a vehicle sale): In case of a car sale, the bill of sale should include the odometer reading of the vehicle.
  • Statement of providing correct information : The bill of sale document should have a statement such as, “I declare under penalty of perjury that this information is true and correct.”
  • Seller signature: A bill of sale isn’t legally binding to any party that hasn’t signed on to it. Ensure that all parties have read and agreed to the terms in the bill of sale before signing.
  • Buyer signature: A bill of sale isn’t legally binding to any party that hasn’t signed on to it. The seller should provide the buyer with the agreement for review. Generally, there is some room for negotiation if the buyer doesn’t agree to any or all terms. After the changes have been made, the buyer can sign the agreement.

Here is a sample of a bill of sale document for a car.

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Do I Need a Bill of Sale?

A bill of sale document functions differently in different states. For example, if you’re selling your car in Montana and don’t have a copy of the car title, the car bill of sale will be needed by the buyer to get the car’s title transferred to them. In contrast, in Georgia you need the bill of sale to receive a Georgia title, registration and license plate.

Some states also require sellers to complete a bill of sale to remove the seller’s name from the car. This can help the seller avoid liability related to the car after it’s been sold. That liability risk might be from the car being used in a crime, in a crash or from it being ticketed.

Therefore, the bill of sale document can be important in the buying and selling of properties such as a car, vehicle, trailer, camper, dirt bike, motorcycle, boat, etc.

Here is an article for you about writing your first bill of sale.

Who Write a Bill of Sale?

The bill of sale might be written by the seller. In some states, the dealership provides the bill of sale document when it sells a car. However, if there is a private sale, both the buyer and the seller might need to generate a bill of sale document, signed by both parties. In this case, a seller may hire a contracts lawyer to draft a bill of sale.

Some states also use a state-authorized template for bill of sale documents. Others allow individuals to write their own bill of sale documents without a template.

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