Vermont Auto Dealer Bond Overview
When you apply for a Vermont dealer license from the Vermont Department of Motor Vehicles - Agency of Transportation, you are asked to obtain and submit a Vermont auto dealer bond.
Without supplying a bond, you cannot get licensed as an auto dealer in Vermont. The bond is necessary because it guarantees your future customers that you are licensed, and that you comply with the 23 V.S.A. Chapters 7 and 21 and 32 V.S.A. Chapter 219. Compliance with these regulations ensures that you will treat your customers fairly and honestly.
In other words, a car dealer bond is an agreement made between the principal (auto dealer), the obligee (the Vermont Department of Motor Vehicles) and the surety which secures the bond financially. The role of the bond is to guarantee that if a customer or the obligee files a claim against the bond, they will be able to receive financial compensation within the full amount of that bond.
A claim is usually filed against a bond when the bond principal fails to fulfill their legal obligations, acts dishonestly or unfairly, or violates regulations, in this case the Vermont Statutes Annotated. Claims are a big problem for any business and are best avoided as they consume time, money and can badly harm a business’s good name.
The specifications of the Vermont auto dealer bond are as follows:
- Surety Bond Name: Vermont Auto Dealer Bond
- Surety Bond Amount: $20,000-$35,000 (depending on the number of vehicles sold)
- Obligee: Vermont Department of Motor Vehicles - Agency of Transportation
120 State Street
Montpelier, VT 05603-0001
- Expiration Date: Issued for 2 years or continual
For details about the cost of your Vermont motor vehicle dealer bond, getting bonded with bad credit and more, see below:
Vermont Auto Dealer Bond Cost
The cost of your Vermont dealer bond depends on the amount of the bond which you need to obtain. Bond amounts for new and used vehicle dealers vary between $20,000 and $35,000, depending on the number of vehicles sold during the previous year.
When you choose the type of bond you need and apply for it, the surety will determine the cost of your bond, your premium, based on your personal credit score. Sureties do take other factors into account as well. These are:
- Your financial statements
- Your liquidity and assets
- Your work record and industry experience
Based on these factors the surety determines the rate it deems suitable for you. Applicants with high credit scores are typically considered very reliable and thus receive low rates on their bond, varying between 1% and 3% of the total bond amount.
|Surety Bond Cost by Credit Score|
|Surety Bond Name||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Vermont Auto Dealer BondFor less than 25 vehicles||$20,000||$200-$400||$300-$600||$400-$800||$600-$1,400|
|25 to 100 vehicles||$25,000||$250-$500||$375-$750||$500-$1,000||$750-$1,750|
|101 to 250 vehicles||$30,000||$300-$600||$450-$900||$600-$1,200||$900-$2,100|
|Wyoming Motor Vehicle Dealer Bond||$35,000||$350-$700||$525-$1,050||$700-$1,400||$1,050-$2,450|
Another factor that determines the cost of your surety bond is the surety agency you work with. Surety agencies work with bonding companies, which provide the bonds and determine the rates.
By working with Bryant Surety Bonds, you are effectively receiving rates from some of the most professional and reliable surety companies in the country. All of these sureties are A-rated and T-listed companies, offering some of the lowest rates on auto dealer bonds in Vermont.
For a ballpark estimate of your dealer bond’s cost, use the surety bond calculator in the right sidebar. If you’d like to receive a precise quote, entirely free of charge, apply by using our online application form.
Call us anytime at (866)-450-3412 for more information regarding your bond or if you need help with your application.
For advice on how to reduce your premium over time or if you want to know more about how rates are determined, visit our Surety Bond Cost page.
Bad Credit Auto Dealer Bonds in Vermont
If you have bad credit, you may be worried about your chances of obtaining an auto dealer bond. Often sureties will turn back applicants who have a low credit score.
However, we’ve partnered with the most trusted surety companies in the nation. Together with them, we have developed our Bad Credit Program that enables applicants with lower credit scores to get bonded without unnecessary trouble. Rates under this program are slightly higher though rarely exceeding 7% of the total amount. By getting bonded with Bryant Surety Bonds, you can always expect to be served by some of the best sureties in the U.S.
Vermont Dealer License: Application and Renewal
To obtain a Vermont dealer license you need to submit some of the following items:
- Completed dealer application form
- Zoning compliance form
- Copy of lease agreement (if applicable)
- Proof of insurance on dealer plates
- Franchise agreement (if applicable)
- A Vermont auto dealer bond (amount depends on number of sales / or if new dealer)
- Background check
- Criminal record check
- Credit report
- Sales tax license
- Registration fee, depending on type of license
Dealer licenses run out within one or two years of the initial licensing, depending on whether the dealer applied for a one or two-year license. When renewing their license, dealers will need to resubmit some of the above documentation, as well as renew their Vermont auto dealer bond and pay a renewal fee. Since deadlines are easily missed, Bryant Surety Bonds reminds all of its clients of the approaching deadline well in advance.
Get Your Vermont Auto Dealer Bond Today
To get your Vermont auto dealer bond apply online here. Filling in your application takes only a few minutes. Shortly after we will contact you with a free quote on your bond.
When your bond is issued, we will mail it to you by post. We also provide a digital copy of the bond, if you should require one.
Do you have any question? Call us at (866)-450-3412 for more information and assistance with your bond application. We will be happy to help you!