How to Create a Tennessee Bill of Sale: A Complete Guide
Why You Can Trust EverQuote
EverQuote powers millions of shopper requests every month, teaming up with industry-leading insurance specialists to address real-world challenges faced by people every day. We partner with the largest insurance providers in the nation, and our content is carefully crafted by experts and reviewed by licensed insurance agents for accuracy and relevance.
From Chattanooga to Memphis and everywhere in between, Tennessee drivers need to know what the state expects regarding bills of sale. The Tennessee Motor Vehicle Commission only regulates licensed sellers, defined by state law as those selling more than five cars per year. So, if you're selling a car, a bill of sale is not legally required unless you make a habit of it. Even so, if you're buying a car in Tennessee, creating a solid bill of sale is recommended. Just like finding the right Tennessee car insurance, getting a bill of sale can save you a headache down the road.
Introduction to the Bill of Sale
A bill of sale is a receipt for the private sale of a vehicle. A bill of sale provides a chain of ownership, demonstrating who can actually claim the vehicle as personal property. This can be more important than you might think. For example, imagine the following situation. An aging driver mistakenly believes his vehicle was stolen when his family made other arrangements for his travel. When the car is reported stolen, a clear Tennessee vehicle bill of sale could help sort out the confusion quickly, while an unclear chain of ownership could muddy the waters.
Legal Requirements for a Bill of Sale in Tennessee
The state does not require a bill of sale for a car in Tennessee unless you are a licensed seller, a title reserved for those selling five or more cars per year. The Tennessee Motor Vehicle Commission advises residents to contact the clerk in their home county to seek further clarification on any additional requirements that may apply.
Essential Elements of a Valid Bill of Sale
A good bill of sale will include the most up-to-date and accurate information about the seller, buyer, and vehicle. A solid Tennessee bill of sale for a vehicle should include current addresses and phone numbers for both the buyer and seller. Likewise, you will want to include the agreed-upon value of the vehicle as well as its make, model, color, and VIN number.
Additionally, it's usually a good idea to note the current reading on the odometer at the time of sale. Finally, be sure to include the date of purchase. The state offers a form you can easily download and print to make the process go even smoother. It's a good idea to have the bill of sale notarized, but in a pinch, signatures from the buyer and seller will do.
Types of Sales Covered by the Bill of Sale
A Tennessee bill of sale can cover multiple types of transactions. Bills of sale are most commonly used for motor vehicles. If the vehicle you're buying has add-ons like a bed liner, running boards, or upgraded wheels, this can also be listed on the bill of sale to ensure agreement between both parties.
Tennessee also recommends a bill of sale to cover the private sale of boats. Much like its land counterpart, a Tennessee boat bill of sale should include the names and relevant information of both parties. Most boats don't have a traditional odometer, so this part will look different. For a boat, you'll want to include info separately on both the hull of the boat and the motor.
Step-by-Step Guide to Drafting a Tennessee Bill of Sale
The state provides a simple bill of sale form that you can print and complete in person. If you prefer to create one yourself, you can follow these steps:
- Record the name, address, and phone number of both the seller and buyer.
- Record the important info about the vehicle, including the make, model, color, VIN number, and current odometer reading.
- If both parties agree about the info listed above, sign the document and, if possible, have it notarized.
Scenarios Where a Bill of Sale Is Essential
Bills of sale are essential in scenarios where ownership is disputed. This can be the case when estates are sorted out as family members age and lose their ability to drive safely. Likewise, if you unwittingly buy a stolen car, a bill of sale may be your best path to sorting out the confusion without being cuffed.
Avoid Common Mistakes When Creating a Bill of Sale
As you finish your bill of sale, look it over to make sure you haven't made some of these common errors for bills of sale. First, make sure you have correctly listed the legal names of both parties. First names alone are fine for some things, but not for legal documents. Next, make sure all the information is up-to-date and accurate. Check that the phone numbers are connected. Double-check the odometer and VIN number since larger numbers are more likely sources of error.
Finally, don't forget to include the agreed-upon date of sale, the purchase price, and signatures. It can be easy enough to list all the important details but leave the document unsigned or the license plate on the car.
Take the Next Step: Compare Car Insurance Options
Obtaining a bill of sale is a great way to protect both the buyer and seller in certain situations. While bills of sale remain optional under state law, Tennessee auto insurance is required. Not every policy is the same, so you'll want to shop around to make sure you find the best coverage and prices in your area. Use EverQuote's easy-to-use comparison tool to shop for cheap car insurance in Tennessee today.
FAQs
The following are some of the most commonly asked questions about completing a bill of sale in the Volunteer State.