What is an Automobile Bill of Sale?
A Complete Guide to Notarizing Your Vehicle Transfer
What is an Automobile Bill of Sale?
A Complete Guide to Notarizing Your Vehicle Transfer
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A Complete Guide to Notarizing Your Vehicle Transfer
An Automobile Bill of Sale is essentially a legally binding receipt. It is a document that records the transfer of ownership of a motor vehicle from a seller to a buyer in exchange for a specific amount of money.
While a vehicle's Certificate of Title is the ultimate proof of ownership, the Bill of Sale serves as the contract of the transaction. For the buyer, it proves exactly how much they paid (which is critical for calculating sales tax at the DMV). For the seller, it proves the exact date and time they released ownership, protecting them from liability if the new owner gets a parking ticket or gets into an accident before registering the car.
The 4 Key Components of a Vehicle Bill of Sale
The 4 Key Components of a Vehicle Bill of Sale
Whether you use a template provided by your state's DMV or a drafted contract, a valid Bill of Sale must include:
1. Vehicle Information
1. Vehicle Information
The exact Year, Make, Model, and the 17-character Vehicle Identification Number (VIN).
2. The Odometer Reading
2. The Odometer Reading
The exact mileage of the vehicle at the time of the sale.
3. Buyer and Seller Details
3. Buyer and Seller Details
The full legal names, addresses, and contact information of both parties.
4. Transaction Details
4. Transaction Details
The exact purchase price, the date of the sale, and typically an "As-Is" clause, stating the vehicle is being sold in its current condition without any future warranties.
Why Does a Bill of Sale Need to Be Notarized?
Why Does a Bill of Sale Need to Be Notarized?
State laws vary drastically when it comes to private auto sales. Some states legally require both the Bill of Sale and the Certificate of Title to be notarized before the DMV will process the transfer (e.g., Pennsylvania, Ohio, Montana, and others). In other states, notarization is optional.
Even if your state does not legally mandate it, notarizing a Bill of Sale is the ultimate best practice for private sales. A Notary Public acts as an impartial witness, verifying the identities of both the buyer and the seller. This completely eliminates the risk of "Title Jumping" (a common fraud where someone sells a car that isn't legally theirs) or a buyer later claiming they never signed the agreement.
The Ultimate Auto Sale Notary Checklist: What to Bring
The Ultimate Auto Sale Notary Checklist: What to Bring
Meeting up to buy or sell a car can be stressful. To ensure a smooth, legally sound transaction, bring the following to your meetup with the Notary:
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The Unsigned Document: Both the buyer and the seller must wait to sign the Bill of Sale until they are in the physical presence of the Notary Public.
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Valid Government-Issued IDs: Both parties must present unexpired, government-issued photo identification (such as a Driver's License or US Passport). The Notary must record both identities.
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The Certificate of Title: Bring the original car title. Depending on your state, the Notary may also need to witness the seller signing the back of the title to release ownership.
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Payment Verification: While the Notary does not handle the money, the transaction should be completed simultaneously. Ensure the funds (cash or cashier's check) are present and verified before the final signatures are notarized.
Top 3 Mistakes to Avoid When Notarizing a Car Sale
Top 3 Mistakes to Avoid When Notarizing a Car Sale
1. Writing "$1" or "Gift" to Avoid Taxes
It is illegal to lie on a Bill of Sale to evade state sales tax. If a Notary suspects the document is being used for tax fraud, they have the right to refuse the notarization. The document must reflect the true purchase price.
2. Not Checking the VIN
Always physically check the VIN on the car's dashboard against the VIN printed on the Title and the Bill of Sale. Even a single incorrect digit can cause the DMV to reject the paperwork.
3. Forgetting to Notarize the Title
If you live in a state that requires notarized car titles, simply notarizing the Bill of Sale is not enough. You must have the Notary stamp the transfer section on the actual Certificate of Title as well.
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