Property transactions always involve sensitive documents, meaning you must know how to write a bill of sale document and what sellers need to disclose. In this post, we’ll outline seven crucial documents that’ll help you buy or sell property without any hassle.
1. Property Deed
For real estate transactions, this proves who legally owns the property and a seller’s right to sell it. Buyers must check this to ensure the home is free of liens and other encumbrances.
The seller provides a new deed during the sale. This could be a warranty deed (giving the buyer full ownership with warranties) or a quitclaim deed (no guarantees or warranties).
2. Bill of Sale
These documents effectively set the terms for the transaction itself. They outline each relevant party, describe the property in full, and discuss payment methods. These forms also protect both sides from future legal challenges.
The seller must present a bill of sale that fits every requirement. If this responsibility falls to you, here’s how to write one of these documents:
- Use an online template site to guarantee a legally binding document
- Specify the type of property you’ll be selling, such as a car or firearm
- Answer any questions the website poses; be as specific as possible
- Describe the property in full – always include its defects, major or minor
- Leave space for two signatures, and possibly that of a notary public
- Create the document and distribute it electronically, or print off copies
Some bills of sale have extra requirements, depending on the property you’re selling. If you sell a car, for example, you must provide its 17-character vehicle identification number (VIN). On top of this, if you sign the bill of sale in person, always meet in a public place.
3. Disclosure Documents
Depending on the type of property, simply describing it won’t be enough. You might also have to provide specific declarations that outline the presence of certain materials or issues. Here are a few examples:
- For real estate, you must disclose if the property has lead paint or asbestos.
- For businesses, you should outline any existing debts and ongoing disputes.
- For vehicles, you must share their maintenance history and odometer readings.
- For intellectual property, you should explain its current licensing agreements.
Ultimately, if there’s anything about the property a buyer should know (legally, ethically, or just to keep them in the loop), get a document that sets these out.
4. Appraisal Reports
As a buyer, you have every right to know if the property you’re purchasing is the real deal. You’ll also want to know if it’s worth the asking price. For example, if buying a home, you should get a thorough inspection that checks for (possibly invisible) damages.
Similarly, anyone buying jewelry must ask for a valuation report; this analyzes the piece’s quality and rough worth and ultimately verifies its authenticity. If you’re selling, you might arrange this in advance so you can provide it to potential buyers upon request.
5. Proof of Identification
If you meet the buyer or seller in person, you must both be willing to provide ID. This does more than just build trust – it proves you’re not dealing with an alias and gives you a name to report if something goes wrong.
Here are a few documents you could use to prove your identity:
- Driver’s license
- Valid U.S. passport
- Military ID card
- Social Security card
- Birth certificate
However, any legal document or card with your name (and preferably your photo) will suffice.
6. Mortgage and Loan Paperwork
If buying a home, it helps to provide paperwork that proves you have a solid payment plan, such as a mortgage pre-approval loan. These documents show your eligibility for a loan and typically mean you’ll definitely secure a mortgage once you apply for one.
Real estate sellers must have confidence in the buyer’s ability to pay for the whole property. You will almost definitely struggle to buy a home without a mortgage (or pre-approval loan).
7. Payment Records
Once the transaction’s complete, keep a copy of any payment records proving that this actually took place. This could save you from a dispute if you’re a buyer and the seller tries to claim you didn’t pay. This also means you shouldn’t use cash or crypto; these don’t have a paper trail.
Documents (physical or electronic) that you should keep include:
- Receipts
- Bank transfer confirmations
- Canceled checks
- Debit card statements
- Escrow closing statements
If you’re the seller and gave an invoice, keep a copy – this helps prove how much you requested for the property.
Final Thoughts
Buying or selling any type of property means navigating a maze of documents – luckily, template sites offer many of these forms with all the right fields already present. You can simply fill them in to match your situation; this is especially important for bills of sale.
