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A horse bill of sale serves as a formal document that records the purchase agreement between a buyer and seller, including the purchase price, relevant sale details, and signatures of both parties. This document confirms the transfer of ownership. The video tutorial covers important aspects of horse bill of sale forms and provides information on where to find a free official template. Before drafting the bill, the video emphasizes the importance of following best practices when purchasing a horse, regardless of experience level. Key steps include locating a suitable seller, establishing a budget that accounts for ongoing care, and personally testing the horse before negotiating the sale.