A Brief Introduction About Car Sale Contract
The Car Sale Contract or the vehicle sale contract is a type of official document that you are required to sign with the third-party user (in case you are selling the vehicle) or with the car owner (in case you are buying the vehicle for yourself). It sets out specific terms as well as conditions of the given sale proceedings. As a car user, you are required to sign the car sale contract before you are being handed over the car keys for its operation.
Whether you buy a car from a private owner or by a person to person sale, in any given case, you are required to sign on the car sale contract form as placed forth by the car owner. These contracts could be for domestic purposes or for purchasing or selling a commercial vehicle
Who Takes the Car Sale Contract?
A car sale contract example typically has two parties –the buyer and the driver or the owner. This contract protects the respective parties involved in the car sale contract. The contract is considered ideal for automobile sales or lease that should not involve anyone in the business of renting or leasing vehicles –for instance, in the case of car dealerships.
Purpose of the Car Sale Contract – Why Do You Need It?
A contract for the sale of a car is a special contract that is made between the owner of the and the individual who would be paying the vehicle’s owner in order to procure the possession of the vehicle or car. The payment of the contract, typically made in monthly payments, consists of a finance fee that is similar to the interest charged on a specific loan, the vehicle depreciation fee, and any other relevant taxes.
In a typical agreement form, the buyer is required to provide important insurance coverage. The main purpose of this agreement is to specify the details of the sale proceedings between the buyer and the seller of the vehicle. This document can be used for selling four-wheeler vehicles including a van, a car, a motorbike, and even a boat. The contract contains specific provisions about the important logistics of the sale, including the overall price of the vehicle, its delivery details, and so more.
Contents of the Car Sale Contract – Inclusions
As a lessee, you are required to sign the car sale contract template indicating that you have read, understood, as well as agreed to the specific terms and conditions of the contract while buying a car. The car sale contract explains the specific penalties that you have to face as a buyer for breaching the terms & conditions of the contract. Once you have signed the car sale contract or agreement, you have basically agreed to be liable for the vehicle from the date mentioned in the contract.
Every selling company or individual is known to specify its own set of terms & conditions in the given vehicle sale agreement. The terms and conditions are known to vary as well in terms of the country in which the contract is being signed. Therefore, as a lessee, even when you have signed the person to person car sale contract template, it is still recommended to go through the contract in depth before signing the same.
When you are signing a typical agreement form, here are some of the contents of the contract you should look into:
- Details of the car selling
- Details of car or the vehicle
- Fuel policy and mileage limits
- Breakdown of the overall cost of the sale including the terms of payment, deposits, extra charges, and rental fees (if any)
- Details of the existing damage
- Details about liability waiver and insurance coverage for the vehicle
- Emergency contact details and breakdown recovery details
How to Draft the Car Sale Contract?
The buyer of the vehicle (the party that is applying for the sale contract) and the owner of the vehicle are expected to agree to the given terms & conditions of the given vehicle sale agreement. The draft or the car sale agreement template can be prepared by the lessor specifying the contractual terms for carrying out the following duties to buy a car from a private owner:
- For carrying out the responsibilities of a vehicle sale company on the basis of the instructions with respect to selling cars like the preparation of the sale certifications, and so more.
- For identifying and screening the car owner and the car buyer
- For notifying the lessee as well as the lessor through an email or printed letters with respect to the automobile, insurance policies, and other lines of business operations along with specific campaigns or events organized by the company
- For statistically aggregating as well as analyzing personal information based on the parties involved in the contract
While drafting a vehicle sale agreement, some of the commonly associated documents might include:
- Sales Agreement – Sales Agreement is a detailed receipt that is used for documenting the specific details of the sale or purchase made
- Bill of Sale – Bill of Sale is a receipt that is used for documenting the sale of some item the purchaser
- Loan Agreement – Loan Agreement is a specific contract that is known to describe the set of terms & conditions between the borrower and the lender
Negotiation Strategy
Ground transportation –including car sale services, is generally signifies around 8-12 percent of the total spend by a corporate organization. Irrespective of the overall size as well as the number of locations across the globe, the corporations that ensure negotiations of the car sale contracts are known to save as much as 10-30 percent of the overall spend on ground transportation. As an individual lessee, you can negotiate with the owner of the enterprise to help you save significantly on your overall spend.
Benefits and Drawbacks of the Car Sale Contract
Buying on a contract allows you to get yourself a brand-new car of your choice at a relatively lower price than any other financing method. While buying a car, there is no worry about the depreciation rates as the end of the contract approaches. Most car purchase deals are known to last for around 2-3 years. Moreover, the monthly costs of leasing a car with the help of a car sale application tend to be lower in comparison to the costs of the other financial deals.
There could be some points of demerits of the car sale contract as well. Buying a contract on an agreement might incur additional costs in comparison to standard buying. If you tend to lease one car after another on a contract, monthly installment payments might extend significantly. Therefore, it is recommended to go through the specific terms & conditions of the contract in-depth.
What Happens in Case of Violation?
If the lessee fails to perform any of the specific obligations of the sale contract(1), the violation of the terms & conditions of the contract might lead to its termination from the lessor’s end. This could happen if the lessee is unable to make the desired payments of the purchase fee. Upon such a case, the lessor has the option to cancel the lease and deliver a written notice to the address of the lessee. Upon receiving the same, the lessee is expected to return the possession of the leased car.
While there are several benefits of signing the car sale contract, it is equally important to go through the specific terms and conditions of the given car sale contract. Make sure that you have read and understood the contract and abide by the same to avoid any major issues. You can also look forward to negotiating effectively with the lessor of the contract.