Auto Dealer Bonds

What is an Auto Dealer Bond?

An auto dealer surety bond is a 3-party guarantee that involves:

• The Principle (You), or person being required to obtain the bond
• The Oblige (in most states this is the DMV, or DOT), or entity requiring the bond
• The Surety, or the company that is backing the bond

The guarantee is that you will abide by the rules and regulations of your licenses.

Why is this bond being required of me?

The bond is being required to protect your customers. The surety bond is in place to compensate your customers should they become victims of fraud or unethical business practices by your dealership. These may include (but are not limited to):

• Not properly transferring a title
• Providing false information about the vehicle’s condition
• Tampering with the odometer
• Failure to honor verbal or written warranties
• Engaging in deceptive financing methods, such as “yo-yo” financing
• Not paying state sales tax or other applicable fees
• Not reporting sales
• Failing to adhere to the conditions of the license

What happens if there is a claim on my bond?

A claim can be made on your dealer bond if you don’t follow all applicable laws and regulations of your state. If a legitimate claim is filed against your dealership, the surety will pay all relevant costs up to the amount of the required surety bond. However, the dealer will have to reimburse these costs to the surety later, which means avoiding claims is the best course of action.

Who Needs to Get an Auto Dealer Bond?

Whether you need to get bonded as a dealer or not depends on the specific regulations in your state. Choose your state below to learn more about its requirements or continue down the page to learn more about the surety bond cost.

Choose Your State

How Much Does an Auto Dealer Bond Cost?

Auto Dealer Surety Bonds are typically underwritten based on the credit score of the ownership, though financials and experience can be considered to help improve your rate. You can read more about the surety bond cost here or use our bond estimate calculator below to get a ballpark price.

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Surety Bond Cost Calculator

Bond Type Select Your Required Bond Auto Dealer BondCollection Agency BondContractor License BondDebt Collector BondFreight Broker BondMedicare/Medicaid BondMortgage Broker BondRetail & Professional Services BondSchool BondSmall Loan Company BondSports Permit BondTax & Utility BondTelemarketing BondTravel Agent BondAll Other License Bonds

State Requiring the Bond Select Your State Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington Washington D.C. West Virginia Wisconsin Wyoming

Surety Bond Amount ($)

Select Your Credit Score Please select Above 700 650 - 699 600 - 649 550 - 599 549 and under

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* This form is for a rough estimate only.

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Can I Get Bonded with Bad Credit?

If you have less-than-perfect credit, or even past bankruptcies, tax liens or civil judgments, Bryant Surety Bonds can still help you get bonded. We operate a bad credit surety bond program, which helps high-risk applicants get the bonds they need.

Call our surety agents at (866) 450-3412 and they’ll be happy to provide personalized advice on how you can build a strong application.

Auto Dealer Bond Application

Getting your bond is a straightforward process. You can apply online and get a quote in minutes, or call (866)-450-3412 and one of our auto dealer bond experts will guide you through the application process.

How to Become an Auto Dealer

States have varying requirements for auto dealers. While posting a motor vehicle dealer bond is always one of them, there are a number of others that you will need to fulfill before you can get your license. Some of the common ones include:

For more information, you can check out our comprehensive infographic guide on how to become a car dealer.

Note: Verify all information with your state licensing authority first, because licensing requirements can frequently change. We have created dealer licensing guides for a number of states, which you are welcome to use as reference:

• Arizona Dealer License Guide
• Alabama Dealer License Guide
• Colorado Dealer License Guide
• California Dealer License Guide
• Georgiа Dealer License Guide
• Illinois Dealer License Guide
• Indiana Dealer License Guide
• Kansas Dealer License Guide
• Kentucky Dealer License Guide
• Michigan Dealer License Guide
• Missouri Dealer License Guide
• Minnesota Dealer License Guide
• New Jersey Dealer License Guide
• New Mexico Dealer License Guide
• New York Dealer License Guide
• North Carolina Dealer License Guide
• Oregon Dealer License Guide
• Pennsylvania Dealer License Guide
• South Carolina Dealer License Guide
• Texas Dealer License Guide
• Washington Dealer License Guide
• West Virginia Dealer License Guide
• Wisconsin Dealer License Guide

About the author:

Todd Bryant

Todd Bryant is a graduate of Germantown Academy and the University of Pittsburgh College of Business Administration Honors College. He has been President of Bryant Surety Bonds, Inc., an A+ rated Business with the Better Business Bureau, since 2007. Licensed as a producer with the Department of Insurance, he has been published in the National Association of Surety Bond Producers newsletter and on numerous authoritative publications such as The Washington Post, Entrepreneur.com, Azcentral.com and many more.