What Is a Bill of Sale?

By Kristi Waterworth – Updated Dec 13, 2024 at 10:35 AM

Key Points

Bills of sale prove ownership and are essential for items of value like vehicles and crop futures.
There are two main types: absolute bills of sale convey outright ownership with no terms.
Conditional bills act as security, ensuring full payment as per agreed contract terms.

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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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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