Motor Vehicle Dealer Bonds
What is Motor Vehicle Dealer Bond? (What does the Surety Bond cover?)
When reviewing your state’s licensing department’s requirements to receive your Motor Vehicle Dealer License, you may see a Surety Bond on the list. The Surety Bond requirement is to enforce dealers to follow state rules and regulations and prevent them from engaging in unethical business practices.
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State | Bond Type | Quotes |
---|---|---|
Alabama | Automotive Dismantler and Parts Recycler Bond | Get Quotes |
Alabama | Used Motor Vehicle Dealer Bond | Get Quotes |
Alaska | Motor Vehicle Dealer - Buyer's Agent Bond New | Get Quotes |
Alaska | Motor Vehicle Dealer - Buyer's Agent Bond Used | Get Quotes |
Alaska | Motorcycle Dealer Bond | Get Quotes |
Arizona | Motor Vehicle Dealer Bond | Get Quotes |
Arizona | Motor Vehicle Wholesale Auction Dealer Bond | Get Quotes |
Arizona | Vehicle Recycler Bond | Get Quotes |
Arkansas | New Motor Vehicle Dealer Bond | Get Quotes |
Arkansas | New Motor Vehicle Dealer Branch Location for Used Vehicles Bond | Get Quotes |
Arkansas | New Motorcycle, ATV, Dealer, or Lessor Bond | Get Quotes |
Arkansas | Used Motor Vehicle Dealer, Wholesaler or Auto Auction Bond | Get Quotes |
California | Motor Vehicle Commercial Requester Account Bond | Get Quotes |
California | Motor Vehicle Dealer Bond ($10k) | Get Quotes |
California | Motor Vehicle Dealer Bond ($50k) | Get Quotes |
California | Motor Vehicle Fuel Distributor Bond | Get Quotes |
California | Motor Vehicle Lessor – Retailer Bond | Get Quotes |
California | Motor Vehicle Registration Servicer Bond | Get Quotes |
California | Motor Vehicle Verifier Bond | Get Quotes |
California | Motorcycle or Wholesale-Only Dealer Bond | Get Quotes |
Colorado | Motor Vehicle Salesperson or Buyer Agent Bond | Get Quotes |
Colorado | New Motor Vehicle Dealer-Wholesaler Bond | Get Quotes |
Colorado | Used Motor Vehicle Dealer Bond | Get Quotes |
Connecticut | Motor Vehicle Dealer Bond - New | Get Quotes |
Connecticut | Motor Vehicle Dealer Bond - Used | Get Quotes |
Connecticut | Motor Vehicle Repairer Bond | Get Quotes |
Connecticut | Motor Vehicle Leasing or Rental Company Bond | Get Quotes |
Delaware | Motor Vehicle Dealer Bond | Get Quotes |
District of Columbia | Motor Vehicle Dealer Bond | Get Quotes |
District of Columbia | Motor Vehicle Repossessor Bond | Get Quotes |
Florida | Franchise Motor Vehicle Dealer Bond | Get Quotes |
Florida | Independent Motor Vehicle Dealer Bond | Get Quotes |
Florida | Mobile Home Manufacturer Bond | Get Quotes |
Florida | Recreational Vehicle Dealer Bond | Get Quotes |
Florida | Recreational Vehicle Manufacturer Bond | Get Quotes |
Georgia | Used Motor Vehicle Dealer Bond | Get Quotes |
Georgia | Used Motor Vehicle Parts Dealer Bond | Get Quotes |
Idaho | Motor Vehicle Dealer Bond - Used | Get Quotes |
Idaho | Motor Vehicle or Vessel Dealer Bond | Get Quotes |
Illinois | Motor Vehicle Dealer – Designated Agent Bond | Get Quotes |
Indiana | Motor Vehicle Merchandising Bond | Get Quotes |
Iowa | Motor Vehicle Dealer Bond | Get Quotes |
Kansas | Motor Vehicle Dealer Bond - Used | Get Quotes |
Kansas | Vehicle Dealer Bond | Get Quotes |
Louisiana | Motor Vehicle Dismantler – Parts Recycler | Get Quotes |
Louisiana | Motor Vehicle Lessor – Used Facility Bond | Get Quotes |
Louisiana | New Motor Vehicle Dealer Used Facility Bond | Get Quotes |
Louisiana | Reconditioned-Rebuilt Motor Vehicle Dealer Bond | Get Quotes |
Louisiana | Recreational Products Dealer Bond | Get Quotes |
Louisiana | Specialty Motor Vehicle Dealer Bond | Get Quotes |
Louisiana | Used Motor Vehicle Dealer Bond | Get Quotes |
Maine | New or Used Motor Vehicle Dealer Bond - Continuous | Get Quotes |
Maryland | Boat Dealer Bond | Get Quotes |
Maryland | Boat Trailer Dealer Bond | Get Quotes |
Maryland | Motor Vehicle Salesman Bond | Get Quotes |
Maryland | Motor Vehicle/Trailer Dealer Bond | Get Quotes |
Massachusetts | Used Motor Vehicle Dealer Bond | Get Quotes |
Michigan | Uniform Motor Vehicle Dealer Bond | Get Quotes |
Minnesota | Motor Vehicle Dealer Bond | Get Quotes |
Minnesota | Motor Vehicle Dealer - Term Bond | Get Quotes |
Mississippi | Designated Agent Bond | Get Quotes |
Mississippi | New Motor Vehicle Dealer Bond | Get Quotes |
Missouri | Motor Vehicle Dealer Bond | Get Quotes |
Montana | Motor Vehicle Dealer Bond | Get Quotes |
Montana | Motor Vehicle Dealer Bond - Manufactured Dwelling | Get Quotes |
Montana | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Nebraska | Motor Vehicle Auction Dealer Bond | Get Quotes |
Nebraska | Motor Vehicle Dealer Bond - New Vehicles | Get Quotes |
Nebraska | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Nebraska | Motor Vehicle-Trailer-Wholesale-Motorcycle Dealer Bond | Get Quotes |
Nevada | Motor Vehicle Dealer Bond - Motorcycles | Get Quotes |
Nevada | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Nevada | Motor Vehicle Dealer/Vehicle Industry Business License Bond | Get Quotes |
New Hampshire | Motor Vehicle Dealer Bond - Motorcycles | Get Quotes |
New Hampshire | Motor Vehicle Dealer Bond - New Vehicles | Get Quotes |
New Hampshire | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
New Hampshire | Motor Vehicle Sales Finance Company Bond | Get Quotes |
New Jersey | Motor Fuels Distributor Tax Bond - Continuous | Get Quotes |
New Jersey | Used Motor Vehicle Dealer License Bond | Get Quotes |
New Mexico | Motor Vehicle Dealer Bond - New Vehicles | Get Quotes |
New Mexico | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
New Mexico | Motor Vehicle Dealer or Dismantler Bond | Get Quotes |
New York | Motor Vehicle Dealer Bond | Get Quotes |
New York | Motor Vehicle Dealer Bond - New Vehicles | Get Quotes |
North Carolina | Used Motor Vehicle Dealer Bond | Get Quotes |
North Carolina | New Motor Vehicle Dealer Bond | Get Quotes |
North Carolina | Motor Vehicle Dealer- Additional Location Bond | Get Quotes |
North Dakota | Motor-Powered Recreational Vehicle Bond | Get Quotes |
North Dakota | Trailer-Dealer Bond | Get Quotes |
Ohio | Remanufactured Vehicle Dealer Bond | Get Quotes |
Oklahoma | Oklahoma City - Used Trailer or Automobile or Parts Dealer Bond | Get Quotes |
Oklahoma | Used Motor Vehicle Dealer Bond | Get Quotes |
Oklahoma | Used Motor Vehicle Salesperson Bond | Get Quotes |
Oklahoma | Wholesale Motor Vehicle Dealer Bond | Get Quotes |
Oregon | Motor Vehicle Dealer Bond ($2k) | Get Quotes |
Oregon | Motor Vehicle Dealer Bond ($40k) | Get Quotes |
Oregon | Motor Vehicle Dealer Bond ($50k) | Get Quotes |
Oregon | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Pennsylvania | Manufacturer/Dealer/Full Agent/Card Agent/Messenger Service/Salvor Bond | Get Quotes |
Pennsylvania | Motor Vehicle Card Agent Bond | Get Quotes |
Pennsylvania | Motor Vehicle Collector-Repossessor Bond | Get Quotes |
Pennsylvania | Motor Vehicle Dealer-Manufacturer Bond | Get Quotes |
Pennsylvania | Motor Vehicle Messenger Service Bond | Get Quotes |
Pennsylvania | Motor Vehicle Salvor Bond | Get Quotes |
Rhode Island | Motor Vehicle Dealer License Bond | Get Quotes |
Rhode Island | Motor Vehicle Dealer's License Bond - Used Vehicles | Get Quotes |
South Carolina | Motor Vehicle Dealer or Wholesaler Bond | Get Quotes |
South Carolina | Motor Vehicle Wholesale Auction-Trailer-Motorcycle Bond | Get Quotes |
South Dakota | Boat Dealer Bond | Get Quotes |
South Dakota | Emergency Vehicle or Trailer Dealer Bond | Get Quotes |
South Dakota | Motor Vehicle Dealer Bond | Get Quotes |
South Dakota | Motorcycle or Snowmobile Dealer Bond | Get Quotes |
Tennessee | Motor Vehicle Dealer Bond | Get Quotes |
Texas | Motor Vehicle Dealer Bond | Get Quotes |
Utah | Motor Vehicle Body Shop Bond | Get Quotes |
Utah | Motor Vehicle Crusher Bond | Get Quotes |
Utah | Motor Vehicle Dealer Bond | Get Quotes |
Utah | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Utah | Motorcycle Dealer Bond | Get Quotes |
Vermont | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Virginia | Motor Vehicle Dealer Bond | Get Quotes |
Virginia | Motorcycle, Trailer, or T&M Vehicle Dealer Bond | Get Quotes |
Virginia | Watercraft Dealer Bond | Get Quotes |
Washington | Motor Vehicle Dealer Bond | Get Quotes |
Washington | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Washington | Recreational License Dealer Bond | Get Quotes |
Washington | Vehicle Maunfacturer Bond | Get Quotes |
Washington | Vessel Dealer License Bond | Get Quotes |
West Virginia | Motor Vehicle Lessor Bond | Get Quotes |
West Virginia | New Motor Vehicle Dealer Bond | Get Quotes |
West Virginia | Used Motor Vehicle Dealer Bond | Get Quotes |
Wisconsin | Motor Vehicle Dealer Bond | Get Quotes |
Wisconsin | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Wyoming | Motor Vehicle Dealer Bond | Get Quotes |
Wyoming | Motor Vehicle Dealer Bond - Other | Get Quotes |
Wyoming | Motor Vehicle Dealer Bond - Used Vehicles | Get Quotes |
Most states require dealers purchase a Surety Bond prior to receiving their license. The state wants to make sure your customers are protected when buying a car from your dealership. Also, the licensing board doesn’t want to be held financially responsible for paying out to your customers if you break the rules.
How does the bond work?
First, let’s make it clear the Surety Bond does not serve the same purpose as traditional insurance. You are not covered under the bond. However, the customers who purchase vehicles from your dealership are covered.
A Motor Vehicle Dealer Bond is a mix of insurance and a line-of-credit. This bond is a contract between you and two other parties.
The Principal – You, the licensed dealer, are listed as the principal on the bond.
The Obligee – The licensing board requiring you to get a Surety Bond.
The Surety – This is the company through which you choose to purchase your bond.
If your customer files a complaint against your business, they may choose to make a claim against your bond. The surety company will payout up to the full bond amount to the claimant if they find the claim to be valid.
What happens if a claim is made on my Motor Vehicle Dealer Bond?
Both you and the surety don’t expect to have a claim filed against the bond. This is why the premium is significantly less than the necessary bond amount. That being said, claims do happen.
In the event your customer files a claim against your bond, your surety company will perform a thorough investigation on the claim. After the investigation concludes, the surety company will payout to the claimant up to the full bond amount if they find the claim to be valid. However, as the principal of the bond, you are responsible for making the surety financially whole by paying them back in full.
Types of Dealer Bonds
The type of Motor Vehicle Dealer Bond and bond amount you require depends on the types of vehicles you sell and the state you operate your business. While many states require a general Motor Vehicle Dealer Surety Bond, some require a specific type of bond for certain license types.
The different type of Dealer Licensing Bonds include:
Auction Dealer Bonds: If you’re planning to sell vehicles at auction, this may be the bond type you require.
Franchise (New) Dealer Bonds: Dealers exclusively selling new vehicles.
Independent (Used) Vehicle Dealer Bonds: Dealers selling used vehicles.
Salvage (Dismantler / Parts Recycler) Dealer Bonds: Selling non-functional vehicles to be used as parts.
Recreational (Trailer / Motorsports / RV) Dealer Bonds: Check with your state’s licensing board to verify if you’ll need this specialty bond type or if a general Motor Vehicle Dealer Bond will cover these types of vehicles.
Wholesale Dealer Bonds: Dealers selling used vehicles to other dealers.
Note that not every state requires licensed dealers to be bonded. The best method to determine exactly what you need is to contact your state’s licensing department. They will provide you with a copy of the bond form if they require you to get a Surety Bond. We’ve created a helpful interactive form to help you determine what type of Motor Vehicle Bond and bond amount you’ll need here.
How much does the bond cost?
Among the factors used to determine the cost of your bond, the surety reviews the amount of the bond, the credit score of all the owners and the length of the bond term. The greater the risk associated with your policy, the higher you can expect to pay in premium. However, many of our surety partners offer Motor Vehicle Dealer Bonds as low as 1% or less of the bond amount. Find quotes for your bond, today!
Can I get a Motor Vehicle Dealer License Bond with bad credit?
Having bad credit doesn’t automatically exclude you from being eligible for a Surety Bond. In fact, we’ve assisted many dealers with non-standard credit get their Motor Vehicle Dealer License Bonds. Due to the higher risk, applicants with non-standard credit typically get quotes within 5%-15% of the bond amount they require, when approved.
We perform a soft-pull when running credit, so your score will not adversely be affected when checked. See what you’ll pay for your bond using the button below.
How to get a Dealer License Bond?
When it comes to getting your Motor Vehicle Dealer Bond, don’t settle for just one quote. We at Surety Solutions, A Gallagher Company have partnered with leading surety companies to bring you an online marketplace to ensure you find the best deal for your bond.
We are licensed to issue bonds in all 50 states. Let us know if you have questions about the bond or our application. Contact our surety professionals by emailing info@suretysolutions.com or call (866) 722-9239. There is no need to wait. View quotes for your Auto Dealer Bond, today!
Additional Surety Bond Resources
Find out everything you need to know about becoming a licensed dealer.
Step-by-step state tutorials on how to become a licensed car dealer.
Answers to frequently asked questions about getting your license.
Make sure you are applying for the correct bond amount with our Bond Amount Calculator.
Worried about a felony on your record? Check out this resource.
Download our free ebook on being a licensed dealer.
Need a different type of Surety Bond?
Click on your state below.