【Used Car Sale】Sample Car Sale Agreement + Important Notes

A car sales contract is an important document in a second-hand car transaction, and its purpose is to protect both the buyer and the seller. Although there is no legal requirement for both parties to sign a car sales contract when buying and selling a used car, the car sales contract can play an important role if any problems or disputes arise during the process or after the purchase of the vehicle.

In addition, since used cars are not as good as new cars, there may be a window period because the seller may need to perform simple repairs or cleaning before handing over the car, and the buyer may also need time to apply for motor insurance or arrange vehicle inspection, etc. If no car sales contract is signed, the buyer and seller can terminate the transaction at any time during this period. On the contrary, signing a car sales contract can ensure that both parties can implement the transaction as scheduled.

Whether you are buying a used car from a private individual or a car dealer, the following items should be included in the car sales contract:

Personal Information

Names and identification document numbers (e.g. Hong Kong identity card, passport, etc.) of the buyer and seller. If it is a used car dealership or purchased in the name of a company, you can write the business registration certificate number.

Vehicle Information

Including vehicle make, model, year of manufacture, body colour and license plate number, as well as chassis/vehicle identification number, engine number and mileage.

Vehicle price and miscellaneous fees

In addition to the price of the vehicle, if the vehicle needs to undergo government vehicle inspection, purchase license plate fees, transfer of ownership and retaining license plates and other procedures, the costs required for the relevant items should be listed and will be borne by the buyer or seller.

Payment Methods

Specify the payment method and date, such as cash, transfer or cheque, whether the payment is a deposit or the final amount of the vehicle price, etc.

Trading Hours

The date of signing the car sales contract and the estimated time of completion of the vehicle transaction should also state what will happen if the transaction is not completed before the specified date, such as whether to cancel the transaction, get back the deposit or add compensation.

Legal Liability

Make sure all traffic violation fines have been paid before the vehicle is transferred, and you can also indicate that the vehicle is not involved in ownership disputes or other legal liabilities caused by the vehicle. After the vehicle is transferred, all legal responsibilities will be borne by the buyer.

Additional matters

Depending on the transaction situation and negotiation between the buyer and seller, additional matters may be added to the transaction, such as after-sales maintenance period and scope, vehicle inspection fees, cancellation mechanism or transaction cancellation arrangement, etc.

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When signing a used vehicle sales contract, in addition to specifying the above information, you should also pay attention to the following matters:

• Read the contract terms carefully before signing
• Verify the identity documents or business registration certificates of both parties
• Carefully check that the chassis/Vehicle Identification Number and Engine Number are the same as those registered on the vehicle registration document (license plate)

• If you are not sure about the condition of the vehicle, do not sign a temporary contract at will. You can discuss with the seller to arrange for a third party to inspect the vehicle before making a decision
• Do not pay any deposit before testing the car
• After signing the provisional contract, take photos of the vehicle inside and outside, especially the wheels, tires, audio system and seats, etc. The contract should also state that the vehicle will be delivered in "as is" to avoid the vehicle being delivered in a different condition
• The temporary car sales contract should be made in duplicate, with the buyer and seller each keeping one copy
• Retain instant communication records with buyers and sellers, including text, photos, videos and documents, as proof of transactions outside the contract