When you sell your vehicle privately, include a mention on your bill of sale that the vehicle is sold "as is." This limits your liability for any vehicle issues the buyer incurs after purchasing it, even though a buyer doesn't have much recourse after a private sale. Even so, document that the vehicle doesn't come with a warranty or any promises that you'll repair it.
Whether your state requires a bill of sale or not, create one anyway. Find a standard template at your state's motor vehicles website or online from a form-template website — certain sites offer free forms to print for personal use. The bill of sale documents the sale and vehicle information, such as the date of the transaction, vehicle identification number, sales price, odometer reading, and buyer and seller information. Add a sentence to the buyer's order that reads: "The vehicle is sold as is without any warranties implied." Both you and the buyer sign the bill of sale and keep a signed copy.
The manufacturer's warranty offers separate coverage from an "as is" sale. A manufacturer warranties vehicles for a specific term and mileage. If the vehicle is still under manufacturer warranty, the coverage transfers to the new owner without you having to mention it on the bill of sale. The warranty doesn't cover maintenance-related issues, such as tires, brakes, windshield wipers or any other damages caused by lack of maintenance. The warranty also doesn't cover cosmetic issues or body damage. Indicating an "as is" sale on the buyer's order limits your liability for these issues.
Transferable Extended Warranty
If you purchased an aftermarket warranty, you may choose to transfer the coverage to the new owner if the provider allows it. Extended warranty coverage differs by provider, but if you have the coverage, call the company to ask how to transfer coverage. Just the same as a manufacturer's warranty, maintenance, maintenance-related repairs and body damage aren't covered under the warranty. Document the warranty transfer on the bill of sale; it should read: "The vehicle is sold as is, without any warranty implied. The sale includes the remaining coverage of a transferred extended warranty."
Dealer Trades and Sales
If you're selling your car to a dealer or trading it in toward another purchase, you don't need an "as is" agreement from a dealership. Dealerships appraise vehicles and offer a price based on appearance and repair needs. If you're uncomfortable with the sale, you might consider asking the dealer to sign an "as is" agreement, but this is likely to caution the purchasing manager, and he'll likely reinspect your vehicle. You receive a buyer's order from the dealer that documents the trade of your vehicle, so you don't need a bill of sale.
- Lending Tree; Ask an Expert — Selling Your Car Privately; Mark Bryant
- Consumer Financial Protection Bureau. "What Is an Extended Warranty or Vehicle Service Contract?" Accessed Oct. 6, 2020.
- Consumer Financial Protection Bureau. "What Is the Difference Between a Manufacturer’s Warranty and an Extended Vehicle Warranty or Service Contract?" Accessed Oct. 6, 2020.
- Kenan-Flagler Business School. "Might I Interest You in an Extended Warranty?" Pages 11–12. Accessed Oct. 6, 2020.
- Federal Trade Commission. "Auto Service Contracts and Warranties," Accessed Oct. 6, 2020.
- Endurance Warranty. "How to Get the Lowest Extended Car Warranty Deductible." Accessed Oct. 6, 2020.
- Consumer Financial Protection Bureau. "Am I Required To Purchase an Extended Warranty or Guaranteed Auto Protection (GAP) Insurance From a Lender or Dealer To Get an Auto Loan?" Accessed Oct. 6, 2020.
- Consumer Reports. "Extended Car Warranties: An Expensive Gamble," Accessed Oct. 6, 2020.
- California Department of Insurance. "Guide to Automobile Service Contracts, Extended Warranties and Other Repair Agreements." Accessed Oct. 6, 2020.
Shanan Miller covers automotive and insurance topics for various websites, blogs and dealerships. She has extensive automotive experience, including auction, insurance, finance, service and management positions. Miller has worked for dealer sales events around the United States and now stays local as a sales and leasing consultant for a dealership.