How to Write a Contract for Buying a Car

The more information in a car sale contract, the better.

The more information in a car sale contract, the better.

Buying a car from someone other than a dealer can be a tricky proposition, requiring you to get as much as possible in writing. A handshake won’t cut it when it comes time to address issues that weren’t disclosed before the sale. Make a car sale contract as complete as possible. Add as much information as you can think of to protect yourself from unscrupulous sellers or an honest miscommunication.

Write the names of both parties at the top of the contract, noting that they are engaging in a contract to sell a specific car. Use full names and addresses. For example, write, “The following is a contract for John M. Smith, 123 Main Street, Wheaton, IL, to sell a 2009 Honda Accord to Fred L. Banks, 234 Oak St., Glen Ellyn, IL.”

Describe the car’s details in one paragraph. Include the make, model, year, body style (such as sedan or coupe), the vehicle identification number, or VIN, and the mileage. Look for the VIN on the inside edge of the driver’s side door, on the dashboard, on the engine or on insurance documents.

Write the terms of payment. Include the full amount, any deposit amount, the date or dates of payments and how payment is to be made. Include any warranty information or guarantees, or if the car is being sold as is.

Add a disclosure statement. Have the seller state that he has disclosed all prior accidents or incidents involving damage to the car; any liens or claims against the car, or that there are none; and any major defects to the engine, electronic systems and power train.

Place the words, “Seller,” “Buyer” and “Witness” toward the bottom of the document in a signature area. Each party should have a witness. Include places for the buyer and seller to write their driver license numbers and the date. Include a statement that the information each party has supplied is true.

Items you will need

  • VIN number
  • Title
  • Mileage

Warnings

  • Discuss how you will transfer title before you sign the contract. Depending on your state’s requirements, you might simply need to have the buyer sign the title, or pink slip, over to the buyer.
  • Use an online service to provide a vehicle report before you buy to learn more about the car's ownership, damage and financial history.

About the Author

Sam Ashe-Edmunds has been writing and lecturing for decades. He has worked in the corporate and nonprofit arenas as a C-Suite executive, serving on several nonprofit boards. He is an internationally traveled sport science writer and lecturer. He has been published in print publications such as Entrepreneur, Tennis, SI for Kids, Chicago Tribune, Sacramento Bee, and on websites such Smart-Healthy-Living.net, SmartyCents and Youthletic. Edmunds has a bachelor's degree in journalism.

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