#1: What It Is
So, what exactly is a California bill of sale? Don’t worry, it’s a simple concept.
A bill of sale is a legal contract. More specifically, it’s a legal contract for the sale of goods, such as autos, motorcycles, RVs, boats, dogs, cats, computers, artwork, or other things. It normally is not used to sell real estate or businesses, or things that aren’t physical such as trademarks.
In short, it’s a legal contract to sell a good within the state of California.
#2: Selling Something for $50,000? Or even $500? You Need One
California wants to prevent fraud. The state therefore has a law requiring a ‘writing sufficient’ to show a legal contract for the sale of all goods for $500 or more.
That means if you’re selling an automobile or something else for $500, $50,000, or even $5 million, you need a written contract. Importantly, a bill of sale satisfies California’s law to prevent fraud. Thus, California courts will be an option for resolving disputes over the sale. In addition, a bill of sale is very flexible, allowing you to set terms and conditions of the sale, such as the payment method, buyer responsibilities, warranties, and more.
#3: A Good Bill of Sale Protects You
If you’re selling a used item — like a car, RV, computer, or something else with moving parts — there’s a chance it will break or have issues after the sale. If you don’t protect yourself, the buyers might sue you, claiming you sold a lemon of an item.
It allows you to sell an old item, like a used car, without a warranty, meaning the buyer will be responsible for all repairs. It also allows you to specify the payment method, and where you’ll be paid.
#4: Beware Free Bills of Sale
With a little digging, you can find a free bill of sale on the Web.
If you do, be careful — most free bills of sale are outdated and written terribly. They’ve been cut and pasted repeatedly, and they confusing and useless words like ‘whereas’ and ‘witnesseth’. In addition, they may conflict with California law. The consequences of using a bad bill of sale can be severe, as you may end up in a lawsuit and with steep legal bills.
You’re selling your used car or other good to make money. Don’t risk losing that money with a bad bill of sale.