A bill of sale is a written record that you and the buyer sign to document the sale of a vehicle between private parties
When you sell a car to someone directly—not through a dealer—a bill of sale creates a paper trail showing who owned the vehicle, when the ownership changed, and for how much. It protects both you and the buyer by recording the transaction details that the title transfer alone does not capture. Most states do not require a bill of sale by law, but many title agencies and lenders treat it as standard documentation, and some states do require it. Even where it is optional, having one in writing prevents disputes later about the sale price, condition, or terms.
The bill of sale is separate from the vehicle title itself. The title is the legal ownership document that gets transferred to the buyer's name at the DMV or your state's equivalent agency. The bill of sale is the receipt and agreement that documents what happened during the transaction. You can create one yourself using a template, buy a blank form from an office supply store, or read one from your state's DMV website—many states publish their own versions.
Key Takeaways
- A bill of sale records the sale price, vehicle details, and buyer and seller information in one signed document that both parties keep.
- Most states do not legally require a bill of sale, but lenders, title agencies, and some states do ask for one during the title transfer process.
- The bill of sale protects you from liability after the sale and gives the buyer proof of purchase for insurance and registration purposes.
- You can use a template from your state's DMV, a generic form, or write one yourself as long as it includes the vehicle identification number, sale price, and signatures of both parties.
What information must go in the bill of sale
The bill of sale should include the vehicle identification number (VIN), make, model, year, and color so there is no confusion about which car changed hands. It must also show the sale price—even if you are selling for a dollar or as a gift, write the actual amount or note "gift" clearly. Many states use the sale price to calculate transfer taxes, so accuracy matters.
Both the seller and buyer names, addresses, and phone numbers belong in the document. Include the date of sale and the odometer reading at the time of transfer. Add a line for both parties to sign and date. Some forms ask whether the vehicle has a lien (an outstanding loan) on it; if it does, note the lender's name and the payoff amount. This tells the buyer they cannot take full ownership until that loan is paid off.
You may also want to note the vehicle's condition—for example, "sold as-is" or list any known mechanical issues. This is not required but can protect you if the buyer later claims you misrepresented the car's state. Some sellers add a line stating the buyer has had a chance to inspect the vehicle and accepts it in its current condition.
Where to find a bill of sale template
Your state's DMV website often provides a free bill of sale form designed to meet that state's requirements. Search "[your state] DMV bill of sale" to find it. If your state does not publish one, the American Automobile Association (AAA) and the National Association of Secretaries of State both offer free templates that work in most states.
Office supply stores sell blank bill of sale pads for a few dollars. Online, you can find templates through LegalZoom, Rocket Lawyer, and other legal document sites, though many charge a small fee. You can also write one from scratch on plain paper as long as it includes the required information and both parties sign it. Handwritten bills of sale are legally valid in most states.
How the bill of sale protects the seller
Once you sign a bill of sale and hand over the keys, you are no longer responsible for the vehicle. If the buyer gets into an accident, racks up parking tickets, or commits a crime with the car, the bill of sale is your proof that you no longer owned it. Without one, a buyer could claim they never took ownership, and you could be held liable.
The bill of sale also protects you if the buyer stops paying a loan on the vehicle or if the car is repossessed. By documenting the sale price and date, you create a record that the vehicle left your possession. Some sellers keep a copy and send a photo of the signed bill of sale to their email as backup.
How the bill of sale protects the buyer
The buyer needs the bill of sale to register the vehicle and obtain insurance. Most insurance companies will not issue a policy without proof of purchase. The bill of sale also serves as proof that the buyer paid for the car, which matters if a dispute arises with the seller over the condition or terms of the sale.
If the seller still owes money on the vehicle (a lien exists), the bill of sale documents that fact. The buyer then knows they must wait for the lien to be cleared before the title can be transferred into their name. This prevents the buyer from paying for a car only to discover later that they cannot legally own it.
State-specific requirements and variations
Most states do not legally mandate a bill of sale for private car sales, but some do. States like Maryland, Michigan, and Ohio require one or treat it as part of the title process. A few states ask for it only if the sale price exceeds a certain amount or if the vehicle is older than a certain year. Check your state's DMV website or call their office to confirm whether a bill of sale is required where you live.
Some states have specific language or formatting requirements for a bill of sale to be accepted during title transfer. A few states ask that the bill of sale be notarized—signed in front of a notary public—though this is uncommon. If your state requires notarization, a notary can usually do it for $10 to $25 at a bank, UPS store, or attorney's office. Using your state's official form, if one exists, is the safest way to meet all local requirements.
What happens after both parties sign
Once you and the buyer have both signed the bill of sale, each of you should keep a copy. The buyer will need their copy when they go to the DMV to transfer the title into their name and register the vehicle. You should keep your copy for your records for at least a few years in case a question arises later about the sale.
The bill of sale itself does not transfer ownership—the title does. The buyer must take the bill of sale, the signed title, and any other documents required by your state to the DMV to complete the transfer. Until that happens, the vehicle is still registered in your name, so make sure the buyer understands they need to complete the title transfer promptly. Some states charge a late fee if the transfer is not done within a certain number of days.
Frequently Asked Questions
Do I have to notarize a bill of sale?
Most states do not require notarization for a private car sale bill of sale. A few states ask for it, so check your state's DMV website. If notarization is required or you want extra protection, a notary public can witness your signatures for a small fee, usually $10 to $25.
What if I sell the car for less than what I owe on it?
Write the actual sale price on the bill of sale, not the loan balance. Note on the form that a lien exists and include the lender's name and payoff amount. The buyer should understand they cannot take full ownership until you pay off the loan and the lien is removed from the title.
Can I use a bill of sale if the seller is not present to sign?
No. Both the seller and buyer must sign the bill of sale in person or have it notarized if signing remotely. A bill of sale signed by only one party is not a valid record of the transaction. If you cannot meet in person, a notary can witness signatures done separately.
What if I lose my copy of the bill of sale after the sale?
Keep your copy for at least three to five years. If you lose it, you can ask the buyer for a copy, though they are not required to provide one. Having a photo or scan of the signed bill of sale stored in your email or cloud storage is a good backup.
Is a bill of sale the same as a title?
No. The bill of sale is a receipt showing the sale happened and for how much. The title is the legal ownership document. The buyer needs both the bill of sale and the signed title to complete the registration and ownership transfer at the DMV.