Buying and selling a vehicle

Consider using a Vehicle bill of sale agreement as a checklist before the sale takes place.

Prepare the paperwork, including the V5C registration document (logbook), handbook, MOT certificate and service log and warranty (if there is one).

Inspect the vehicle and add any problems, such as damage, to the agreement so that it is ‘sold as seen’.

Agree on the price and fill in the necessary details (date, price, registration, make and model, names and addresses) on the agreement.

Make two copies of the completed agreement (for seller and buyer) and sign both.

The seller must complete the tear-off portion at the bottom of the V5C registration document (logbook) and send it to the DVLA and give the top part of the V5C to the new owner.

The seller must hand over to the buyer the car handbook, service log and MOT certificate (if it has one).

If it is not included in the sale, the seller can return the tax disc to the DVLA for a refund.

Insurance arrangements for the vehicle must be changed to reflect the change in ownership.

The advantages are that it creates a straightforward legal contract between the seller and the buyer on a 'sold as seen' basis; it sets out all of the important things to be included and checked to avoid hassle afterwards.

If you are selling a caravan the type of agreement you need may depend on the type of vehicle you’re selling. There are a variety of different types of caravans, such as a Motor Caravan or a Trailer Caravan. 

'Motor caravan’ typically means a special purposes passenger car constructed to include living accommodation which contains at least the following equipment:

• seats and table
• sleeping accommodation which may be converted from the seats
• cooking facilities
• storage facilities

This equipment should be rigidly fixed to the living compartment; however, the table may be designed to be easily removable.

In this instance, Motor Caravans are usually classified as 'vehicles' and you can use a Vehicle bill of sale agreement.

'Trailer caravans', on the other hand, are usually seen as those which are towed by another vehicle (such as a car). In this instance, as these are usually stationary (only with the exception of when they are being towed), they would normally be classified as 'goods' and you may need a Sale of goods agreement.

You can read this guidance from the Vehicle Certification Agency as to what categories caravans come under.

If properly completed, the Vehicle bill of sales creates a legally binding full and final settlement for peace of mind - even if the vehicle is damaged.

It provides a reminder to the seller of the important details to check before the sale to avoid problems or price reduction.

It also includes an obligation on the buyer to pay the whole sum within a certain time in cleared funds before the buyer can take ownership of the vehicle.

The agreement provides a list of the important details to check such as the correct paperwork and whether the vehicle has been used as a rental car etc.

It means that the seller must tell the buyer about any damage or problems before the sale.

It also includes an obligation to post the New Keeper registration certificate document to the DVLA.