What Is a Bill of Sale?

By Kristi Waterworth – Updated Dec 10, 2025 at 12:59 AM EST

Key Points

A bill of sale proves ownership of items post-sale, valuable for vehicle and crop future sales.
There are absolute and conditional bills of sale, impacting the terms of ownership transfer.
For futures investors, bills of sale facilitate commodity trading like transferring grain ownership.

If you've ever bought something of significant value from or sold it to a stranger, you've probably used a bill of sale, even if you didn't know what it was at the time. Bills of sale can act as proof of ownership of items with significant value. That can be absolutely anything from cars to soybean futures. Read on to learn more about bills of sale and why they matter.

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Car with a for sale sign in the window. — Image source: Getty Images.

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A share of stock represents ownership in a company, entitling holders to a portion of its assets, profits, and voting rights.

A bill of sale, also called a delivery instrument, allows you to easily transfer your soybeans, corn, or other commodity you're buying to the final buyer. So, for example, if you buy a grain silo full of wheat, you'll get a bill of sale from the farmer who grew the wheat. Since you don't intend to keep the wheat for personal use (it is a lot of wheat, after all), you'll be reselling it to someone who can use that much wheat.

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Instead of taking delivery of a grain silo's worth of wheat (really, a tremendous amount of wheat), the farmer agrees to let you store the wheat in their silo until you have a final buyer. Then, using a bill of sale, you sell the final buyer the right to the wheat.

The final buyer, with the bill of sale in hand outlining what they bought from you, can then go to where the wheat is stored, present their bill of sale, and collect the wheat from the farmer's silo. In some cases, you won't be the trader to find the final buyer.

Instead, you may sell your bill of sale (your right to an amazing amount of wheat) to another trader, who may sell the bill of sale again to yet another trader until it finally finds its way into the hands of the owner of a shredded wheat factory. This simplifies commodity trading since you only have to sell the rights to the property and don't have to move the property multiple times.

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

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