What a California bill of sale does and when you need one

A bill of sale is a document that records the transfer of a vehicle from one owner to another. In California, it serves as proof that you bought or sold a car, truck, or motorcycle, and it protects both the buyer and seller by documenting the sale price, the vehicle details, and the date of the transaction.

You need a bill of sale whenever you buy or sell a vehicle in California, whether you are dealing with a private party or a dealer. Private sellers are required by California law to provide a bill of sale to the buyer. Even though the Department of Motor Vehicles (DMV) does not require you to submit a bill of sale with your title transfer paperwork, having one on file protects you if a dispute arises later about the sale price, condition, or ownership transfer.

The bill of sale becomes especially important if the buyer later gets into an accident or receives a traffic citation before the title is officially transferred. Without a bill of sale, you could be held liable for damage or fines incurred after you sold the vehicle. For the buyer, it proves they purchased the car legitimately and establishes when ownership changed hands.

Key Takeaways

  • California law requires private sellers to provide a bill of sale to the buyer, though the DMV does not require you to file it with your title transfer.
  • A bill of sale protects both parties by documenting the sale price, vehicle identification number (VIN), odometer reading, and the date of transfer.
  • You can use the official California DMV form (REG 135) or a private bill of sale template, as long as it includes all required information.
  • The buyer should keep the bill of sale with their title documents, and the seller should keep a copy for their records in case of future disputes.

What information must be included on a California bill of sale

California does not mandate a specific form for a bill of sale, but the document must include certain details to be legally valid. The buyer and seller names, addresses, and signatures are required. You must also list the vehicle's year, make, model, color, and Vehicle Identification Number (VIN), which appears on the dashboard and the title.

The sale price must be stated clearly, even if the vehicle was a gift (in which case you would write "gift" or "$0"). The odometer reading at the time of sale is required by federal law and must be recorded on the bill of sale. Include the date the sale took place and note whether the vehicle is sold "as is" or with any warranties or conditions.

If the vehicle has a lien (meaning a bank or lender still owns it), this must be disclosed on the bill of sale. The seller should also note whether they are providing the original title, a duplicate title, or if the title is still being obtained. Any known mechanical or safety issues should be documented to protect both parties.

Using the official California DMV form versus a private template

The California DMV provides form REG 135, which is the official bill of sale form. You can read it from the DMV website or pick up a copy at any DMV office. This form includes all the required fields and is recognized by the DMV, lenders, and insurance companies. Using the official form removes any question about whether your bill of sale meets legal requirements.

You can also use a private bill of sale template from a legal document service, online template site, or even a handwritten document, as long as it includes all the required information listed above. Many buyers and sellers prefer templates because they are often simpler to fill out and may include additional protective language. The key is that the document must be signed by both parties and include the essential details.

Whichever format you choose, make sure both the buyer and seller sign and date the document. Some people have the signatures notarized, which adds an extra layer of legal protection, though California does not require notarization for a bill of sale to be valid.

Step-by-step process for completing a bill of sale

Start by gathering the vehicle information: the VIN, year, make, model, color, and current odometer reading. Check the title or registration to may support accuracy. Write or type the buyer's full name and address, then the seller's full name and address. Include the sale price in words and numbers (for example, "Two Thousand Five Hundred Dollars ($2,500)").

Record the odometer reading as it appears on the instrument cluster at the time of sale. Note the date of the transaction. If you are using the official DMV form REG 135, fill in each field clearly. If you are using a template or handwritten document, make sure all required information is present and legible.

Both the buyer and seller must sign and print their names on the bill of sale. Some templates include a section for the buyer to acknowledge the vehicle's condition and any known defects. Once signed, make at least two copies: one for the buyer, one for the seller. The buyer should keep their copy with the title and registration documents.

What happens to the bill of sale after the sale

The buyer should keep the bill of sale in a safe place with their title, registration, and insurance documents. When the buyer registers the vehicle with the DMV, they do not need to submit the bill of sale, but having it on hand speeds up the process if the DMV asks for proof of purchase or if there is a question about the transfer date.

The seller should also keep a copy of the signed bill of sale for at least three to five years. If the buyer later gets a traffic ticket or is involved in an accident before the title transfer is complete, the bill of sale proves that you are no longer the owner. Without it, you could receive notices or be held responsible for violations that occurred after the sale.

If you sell a vehicle with an outstanding loan, the bill of sale should note that the title is being held by the lender. The buyer will need to work with the seller to may support the lender releases the title once the loan is paid off. The bill of sale documents this arrangement and protects both parties during the transition.

Common mistakes to avoid when writing a bill of sale

Do not leave any required fields blank. An incomplete bill of sale can create confusion about the sale price, the vehicle, or the date of transfer. Double-check the VIN against the title or registration to make sure it is correct; a wrong VIN can cause problems when the buyer tries to register the vehicle.

Avoid using informal language or abbreviations that might be misunderstood later. Write out the full sale price in both words and numbers to prevent disputes. Do not forget to include the odometer reading, which is a federal requirement and is needed for the buyer's title transfer.

Make sure both parties actually sign the document. A bill of sale without signatures is not legally binding. If either party is uncomfortable signing, that is a sign that the sale itself may not be straightforward, and you should resolve any concerns before completing the transaction.

Frequently Asked Questions

Does the DMV require me to file a bill of sale?

No. The DMV does not require you to submit a bill of sale with your title transfer paperwork. However, California law requires the seller to provide one to the buyer, and keeping a copy protects both parties if disputes arise later.

What if I lost the bill of sale after I bought the car?

If you no longer have the bill of sale, you can still register the vehicle using your title and proof of purchase (such as a receipt or bank statement showing the transaction). Contact your local DMV office to ask what documents they will accept as proof of ownership.

Can I use a bill of sale if the vehicle has a loan against it?

Yes. The bill of sale should note that the title is held by the lender and will be released once the loan is paid off. The buyer should not take possession of the title until the lender releases it, even though the bill of sale transfers ownership.

Is a notarized bill of sale better than an unnotarized one?

Notarization adds legal weight and makes the document harder to dispute, but California does not require it. If you are selling a high-value vehicle or want extra protection, notarization is worth the small cost at a bank or notary service.

What should I do if the buyer and I disagree on the sale price after signing?

The signed bill of sale is a binding record of the agreed price. If a dispute arises, the bill of sale is the legal document that settles the matter. This is why it is critical to make sure both parties agree on the price before signing.