A bill of sale is a legal document that the seller uses to transfer the title of the vehicle/vessel to the buyer.
The bill of sale allows both the buyer and the seller to specify detailed information about the vehicle and the terms of sale.
California’s DMV provides an approved bill of sale. Note that you should use this bill of sale for vehicle/vessel sales only.
If you sell other valuable assets, such as equipment or a firearm, you should use the equipment bill of sale, firearm bill of sale, or another bill of sale specified in the blank bill of sale section on our website.
If you don’t find an appropriate bill of sale, you can use the general bill of sale form.
Both the seller and buyer must complete the following information on the bill of sale:
- The names, addresses, and signatures of both the buyer and the seller. Note that in California, it must include the signatures of both parties, although they do not need to be witnessed or notarized.
- Complete information on the vehicle, including make, model, year, and vehicle identification number (VIN).
- The date of the sale and the price.
It is also important to note that if you transfer the vehicle as a gift, there is a space on the California bill of sale form to indicate both the relationship and the value of the gift.
Whether you are the buyer or the seller, you must understand that a complete bill of sale protects your rights and spells out your responsibilities before the money changes hands. Additionally, this protects your interest in the sale should questions about the terms arise at a later time.
Benefits of the California bill of sale form
Completing the sale with a bill of sale brings benefits to both buyer and seller, as mentioned below:
Seller
The bill of sale protects the seller from future disputes. For example, suppose a vehicle is being sold as-is.
In that case, you can use the bill of sale to specify the vehicle’s condition at the time of sale, protecting you from liability if any problems arise after the buyer has driven the car away.
Buyer
A bill of sale proves that the buyer is the new owner of the vehicle.
The buyer can use the bill of sale to register the vehicle at the California Department of Motor Vehicles.
Additionally, the buyer can use the bill of sale to purchase insurance for the vehicle.
If you are the buyer, ensure that you retain the title after the sale.
The title is the legal proof of vehicle ownership, not the bill of sale.
California’s notice of transfer and release of liability for the used car sale
If you sell your used car, in addition to the bill of sale, you must also complete the form REG 138, also known as the Notice of Transfer and Release of Liability form.
This form will release you, as the seller, from liability, e.g., if the new owner is involved in any criminal offenses, you will not be responsible.
According to the state’s law, you must submit the form within five calendar days after selling the used car.
Additionally, the new owner of the used car must apply for the title transfer to complete the process.
