The contract definition derives from California civil code section 2981.

“Any contract for the sale of a motor vehicle between a buyer and seller under which possession is delivered to the buyer and seller and either:

  1. the title vests in the buyer thereafter only upon the payment of all or a part of the price, or the performance of any other condition, or
  2. a lien in the property is to vest in the seller as security for the payment of part or all of the price, or for the performance of any other condition.”

See Sample on pages 67 – 80.

A successful sale is a process involving a certain order of events. A sale made in the wrong order may “unwind” a sale.

See Sample on pages 67 – 80.

A sales tax refund is allowed if the buyer does not take possession. All contracts for purchase of a motor vehicle must be in writing.

The contract must be contained in a single document.

We recommend contracts containing “California Judicial Council” stamp.

The contract must contain all agreements of the buyer and seller with respect to the total cost and terms of repayment for the motor vehicle. This shall include any evidences of indebtedness, including a promissory note.

All contracts for the purchase of a motor vehicle must be signed by both buyer and seller and delivered to the buyer.

  • A contract signed by the dealer only is called a purchase order.
  • A Spanish copy, blank, attached to the original for Spanish speakers.

All contracts for the purchase of a motor vehicle require certain disclosures as per the civil code and Federal Regulation

cash price

* w/ demand of title price + tax only

document prep fee

$70 maximum. ( same for ALL )

smog fee

$50 maximum for inspection

$8.25 maximum for certificate

sales tax

based on county of residence

service contract charge

only if sold by dealer ( extra warranty )

These items must be disclosed on the sales contract: Itemization of Amount To Be Financed

Amounts Paid To DMV

transfer fee


registration fee

collect if: registration expired or within 60 days dealer pays to date of sale

buyer pays forward

to estimate .2.2% + $60. x .40 Dealer Hotline 800.777.0133

trade-in allowance

describe vehicle & subtract payoff

deferred down payment

paid within 30 days * no post dated checks

cash amount

paid on date of contract

Amounts Paid for Insurance Premiums * only if sold by dealer Down Payment Total

These items must be disclosed on the sales contract per federal law:

  • Annual Percentage Rate
  • Finance Charge
  • Amount Financed *must match Total Amount Financed above.
  • Total Of Payments
  • Total Sales Price
  • Payment Schedule

To access the DMV used vehicle fee calculator go here:

For Tri Star’s Motors Contract Preparation Form go to:

The sales contract must clearly indicate:

Interest computation and conversion to Annual Percentage Rate Monthly payment amount and how computation was made Hidden, deferred or balloon payments and due dates.

A refund of any and all moneys paid by purchaser shall be made by the dealer when the purchaser elects not to sign the contract.

  • Deposits do not give the dealer ANY advantage.
  • Even if the purchaser signs the contract and pays for the vehicle the sale does not transact until the purchaser takes delivery of the vehicle.

Remember: Seller signs, Buyer signs, Buyer gets copy, Seller gets cash.