If you have a used car to sell, attaching a bill of sale to the transaction is always a good idea. Bill of sales are documents that protect buyers and sellers from future disputes. Before you sell that car you no longer need, make sure you read this post.
Bill Of Sale
A bill of sale is a document that indicates a transfer of ownership of a property from one person (seller) to another (buyer). This document is commonly used to show proof of the sale of transport vehicles like cars, trucks, motorcycles, and even watercraft. Since it is legally recognized as a valid document, buyers and sellers prefer to use it.
The seller’s responsibility is to draft the bill of sale to indicate all the information about the transaction. With a bill of sale, the interest of both parties will be protected – should a dispute arise in the future.
What A Bill Of Sale Should Contain
A bill of sale is a good idea whenever you are selling a car. This document contains valuable information about the car and any future liabilities if they exist. In many jurisdictions, a bill of sale is a requirement for the sale of any item; without one, the transaction may be termed illegal.
Although not every transaction will be completed using this document, any transaction involving an item of significant value should always be done with a bill of sale.
As a seller, issuing a bill of sale for the car will absolve you of future responsibilities. If you are the buyer, you will not be left in doubt regarding the car’s condition and your responsibilities and expectations.
The bill of sale for a car should contain the following
- The name and address of the seller and buyer
- A clear description of the car (brand, model, color)
- The amount paid for the car
- Guarantee that the car is free from third-party claims
- Warranties (if available)
- Signature of the buyer, seller, and a licensed notary
This information should be included in the document for legal as well as for transparency reasons. Furthermore, it should be written by the statutes of the local laws. These laws regarding the sale and purchase of assets differ from one jurisdiction to the next, so failure to prepare it in line with the local laws may render it invalid.
If your state does not require a notary signature, don’t have it notarized.
Reasons Why You Should Draft A Bill Of Sale For A Car Sale
Now that you know what a bill of sale is and the vital information it should contain, let us furnish you with some reasons why you should draft one for a car sale. If you are the buyer, these reasons apply to protect your interest.
The first and most important reason you need a bill of sale for a car sale is to provide you with legal protection. This document proves that the transaction took place for buyers and that money was paid for the car. In the future, should your ownership be disputed, you can always present the bill of sale as proof to show that you paid for it.
For sellers, the bill of sale absolves the previous owner of any liabilities incurred by the new owner, such as speeding or parking tickets. The seller will also not be held responsible for any repairs or faults in the vehicle unless stated expressly in the document. If both parties append their signature, the contract becomes legally binding.
For Registration Purposes
Another reason drafting a bill of sale for a car sale is a good idea is because it makes it easy for the new owner to register the car in their name. Car registration exercises require specific information like the model, year of manufacture, and vehicle identification number. If the bill of sale contains these details, the buyer will have no issues convincing the authorities that he is the new owner.
It Provides Clarity
A bill of sale makes the transaction more transparent. The buyer will be armed with all the facts to make better decisions in the knowledge that all the information provided by the seller and contained in the bill of sale is valid; it can also provide clarity on grey areas that may cause disputes. Furthermore, the buyer can verify the information contained in the document. For instance, if the seller provides a vehicle history report, the buyer can verify it by comparing it with what is on the bill of sale besides conducting an independent inquiry. Everything in a bill of sale is made transparent.
Drafting a bill of sale for a car sale is wise to avoid future disputes between both parties or to fight third-party claims or liabilities.