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A horse bill of sale is a document that formalizes the purchase of a horse, detailing the purchase price and other relevant information, along with the signatures of both the buyer and seller. This document officially records the transfer of ownership. In the video, important details about horse Bill of Sale forms are discussed, including how to obtain a free official template. Before drafting the Bill of Sale, it is essential to understand the horse buying process, which entails locating a suitable seller, setting a budget that includes ongoing costs, and testing the horse personally to ensure compatibility. Following best practices in horse ownership is crucial for both experienced and novice buyers.