If you’re buying or selling a car it’s likely you’ll come upon a bill of sale. A bill of sale is the legally binding document that records the transfer of ownership for the car you’re selling or buying.
The part that makes it legally binding is having it notarized. When something is notarized it means that the document is authentic and genuine. You’ll likely have to deal with a notary if you set up a business, buy a house or even while you’re applying for a passport to travel.
Before you can consider the sale of your car official and update the DMV, you will have to have the bill of sale notarized.
What is a Notarized Bill of Sale?
Notarization is the official fraud-deterrent process that assures the parties of the transaction that the document is authentic and can be trusted.
A notarized bill of sale will protect both the buyer and seller from fraud or scams. By going through the notarization process you can ensure a smooth transfer of ownership. In some cases, you will be required to get a bill of sale notarized for the DMV or others to process it.
Steps to get a Bill of Sale Notarized
It’s fairly simple to get a bill of sale notarized and even though you may not need it notarized, you should still do it to protect both parties.
A notarized bill of sale can be used for tax purposes, proof of ownership or even future legal disputes.
The steps you’ll want to follow are:
- Find a notary public or notary services near you.
- Schedule an appointment with the notary.
- Find & bring all necessary paperwork.
- Sign the bill of sale in front of the notary.
- Pay the notary fee. This fee can vary but it’s usually around $25.
- Receive a notarized bill of sale.
It’s very important to make sure you have all the correct paperwork and valid identification. If you don’t have the right paperwork it can delay the process and you may have to reschedule your appointment.
Importance of Having a Notarized Bill of Sale
The seller and buyer of the car should keep a notarized bill of sale for many reasons but most importantly protection.
You will want to maintain a copy of the bill of sale for:
- Tax purposes: You may need to show proof of income from the sale of a car. A bill of sale can help you do that. On the other hand, if you can write off a car purchase, you will need the bill of sale when you file your taxes.
- Proof of ownership: Some states require you to show proof of ownership before you can register your car. Some specifically require a bill of sale. It’s a smart idea to have it in your files in case you need it.
- Legal disputes: If you’re ever in a legal dispute involving ownership of the car, you will need documentation. A notarized bill of sale trumps all other claims in a court of law.