Question 1

What is a Vehicle Bill of Sale?

Accepted Answer

**A Vehicle Bill of Sale is a legal document that records the sale and transfer of a vehicle from the seller to the buyer**.  
It serves as an official receipt that confirms the change of ownership and outlines the agreed-upon terms of the transaction — even if payment isn’t made immediately.  
While there’s no national standard form, California provides its own official version — the **REG 135 (Bill of Sale)** — issued by the **California Department of Motor Vehicles (CA DMV)**.  
Using this form helps protect both parties and simplifies title transfer, registration, and tax reporting.

Question 2

When to use a Vehicle Bill of Sale?

Accepted Answer

In **California**, a Vehicle Bill of Sale is **not always required**, but it becomes **mandatory** in specific cases — for example, when the title does not list the sale price, when the vehicle changes ownership without a title (e.g., duplicate title pending), or when the vehicle is gifted or partially paid for. In most standard sales, the transfer section on the Certificate of Title serves as proof of sale. However, completing a **Bill of Sale (REG 135)** is strongly recommended because it provides written proof of the transaction, helping both parties avoid future disputes or liability issues. After completing the sale, the seller must also file a **Notice of Transfer and Release of Liability (NRL)** with the **CA DMV** within **five (5) days**, which releases them from liability for the vehicle.

Question 3

What should be on a Vehicle Bill of Sale?

Accepted Answer

To avoid confusion and make things easier with the **CA DMV** or insurance companies, your Vehicle Bill of Sale should include:

-   Full names and contact details of both the seller and the buyer
    
-   Vehicle details: make, model, year, license plate number, and VIN
    
-   Exact date and time of the sale (to protect against future fines or tickets)
    
-   Total sale price and payment method
    
-   A statement that the vehicle is sold “as-is” (unless a warranty is provided)
    
-   A declaration that the vehicle is free of liens or outstanding loans
    
-   Any additional terms agreed upon (such as included accessories or known defects)
    
-   Signatures of both parties

Full names and contact details of both the seller and the buyer

Vehicle details: make, model, year, license plate number, and VIN

Exact date and time of the sale (to protect against future fines or tickets)

Total sale price and payment method

A statement that the vehicle is sold “as-is” (unless a warranty is provided)

A declaration that the vehicle is free of liens or outstanding loans

Any additional terms agreed upon (such as included accessories or known defects)

Signatures of both parties

Using the official **REG 135 form** ensures all required details are included and avoids registration delays.

Question 4

What if the vehicle’s condition doesn’t match what’s stated in the Bill of Sale?

Accepted Answer

If the vehicle’s condition doesn’t match what’s stated in the Bill of Sale, first contact the seller in writing to try to resolve the issue — for example, by requesting repairs, a refund, or a price adjustment. If that doesn’t work, document the problems with photos or a mechanic’s report and consider your legal options. Providing false or misleading information about a vehicle’s condition, mileage, or title status can be considered misrepresentation or fraud, giving the buyer grounds to cancel the agreement or take legal action. Acting quickly is important, and you can also file a complaint with the **California DMV Investigations Division** or the **California Attorney General’s Office**. Always make sure the Bill of Sale accurately describes the vehicle and clearly states if it is sold “as-is,” unless a warranty is provided.

Question 5

Can I sell a car that’s still under a loan or with an existing lien?

Accepted Answer

**Yes, but you can’t complete the sale until the lien is cleared**. In California, the lienholder (such as a bank or finance company) is listed on the vehicle’s title and **holds the legal right to the car until the loan is paid off**. You must contact the lienholder before selling the vehicle.

Typically, the buyer pays the remaining loan balance directly to the lender or through an escrow process. Once the loan is satisfied, the lender issues a lien release and sends the title to either you or the buyer. Only then can the California Department of Motor Vehicles (DMV) transfer ownership.

**Attempting to sell or transfer a vehicle with an active lien without the lender’s approval is not valid under California law**, and the DMV will not process the title transfer.

**Always** disclose any existing liens in the Vehicle Bill of Sale to avoid legal issues or disputes after the sale.

Vehicle Bill of Sale: VIN, Price and Signatures – California