Your score will determine whether you qualify for a loan and the interest rate you’ll pay.
What is a bill of sale?
A bill of sale comprises written documentation of the sale or transfer of goods or property from one party to another. A bill of sale provides legal evidence that a seller has transferred all rights to an asset to a buyer.
A written record of a sale is important for purchases big or small, especially for transactions between private inviduals. With private sales, there’s rarely any documentation about the history of the asset being exchanged; having an accurate record of when and where the item was sold, and the names of the seller and the buyer, offers protection to both sides. The bill of sale serves as a contract between the buyer and the seller, which ends the seller’s responsibility for the property.
The level of detail required on a bill of sale depends on the type of transaction. In some cases, the bill of sale supports the new owner’s ability to register a vehicle such as an automobile or an RV. In these cases, the bill of sale should conform to state regulations. For a private vehicle sale, states may require a signature by both parties, a current odometer reading, and notarization.
Vehicles including cars, trucks, RVs, and motorcycles are among the most common types of personal property that require a bill of sale. Other types include boats, aircraft, pets, electronics, and furniture.
If state laws require a specific type of bill of sale, blank forms can be found online or at the county clerk or Department of Motor Vehicles. Otherwise, the parties to a deal can create a simple bill of sale and fill it out with the necessary information at the time of purchase.
Shopping for a new car? Let Bankrate help you find a great deal on an auto loan.
Bill of sale example
Jonathan bought a used Honda automobile from a private seller who also financed the purchase. The bill of sale was part of a larger agreement that specified the payment amount, due date, and payment timetable, along with a clause that the transfer of title would occur once Jonathan made his final payment.