What is a Bill of Sale?

Bill Of Sale is a document or receipt used to transfer the ownership of an object from one party to another. A free bill of sale, is like a proof of purchase, or a proof of payment, or a sales receipt.

A bill of sale records a transfer of property or sale of items between a seller and a buyer. It serves as a piece of evidence that the seller has transferred his/her rights to the assets mentioned in the bill of sale, to the buyer. As per law, the seller will draft the said document, for example bill of sale for car.

It can be used as a valid proof in all legal matters.

Bill of Sale is evidence of transaction between two or more parties.

2. What kind of information to be included in Bill Of Sale?

It consists of the following essential information:

Basic details

· Name and address of the seller.

· Name and address of the buyer.

· Date of the transaction.

· Previous owner(s) (if any).

Description of the item

· Identification number.

· Serial number.

· Make and model

· Design.

· Size.

· Color.

· Any specific mark or features.

· Any defaults of the item.

· Conditions of sale.

Additional information needed for vehicle sale

· VIN, or vehicle identification number.

· License plate number.

Payment information

· Amount paid (written in words and in numbers).

· Method of payment.

· Did the buyer pay in instalments or in full at the time of purchase?

· Did the buyer pay with cash, credit/debit card, bank deposit, or check?

· Other covenants concerning

· Deadline for pending payments.

· Terms and conditions for late payment.

· Interest rate (if any).

3. Why is it used?

It signifies two fundamental purposes:

· Confirming that the ownership of an asset has been transferred from one party to another.

· It serves as legal evidence in the court of law.

4. Sales contract vs Bill of Sale. (Bill of sale vs Title)

The difference between a sale contract and a bill of sale while deciding which document you need.

A sale contract:

· Entered into between a buyer and a seller.

· Details the terms and conditions for a buyer to agree to purchase an item and a seller to agree to sell it on a later date.

· Records the future sale of an asset. It is used before the exchange of an item occurs

A bill of sale:

· Transfers ownership of the property.

· Provides the exact details of the item the buyer will purchase.

· Contains the covenant that the person selling the items has a valid title to the asset and also the right to transfer the title.

· May contain the warranties about the asset being sold.

· Used during or after a product exchange.