Starting and running an auto dealership business in Georgia is a challenge on its own. It gets even more difficult if you are struggling with a bad credit history. There is good news though: getting your Georgia dealer bond is possible, even with not-so-perfect credit.
Although some sureties find it problematic to write bonds for dealers with bad credit, here at Bryant Surety Bonds we think differently. With our Bad Credit Program, we help dealers get in the business and stay there, by providing them with continuous bonding.
Before we get to the least troublesome part of getting bonded, let’s review the auto dealership licensing process with its options and requirements.
Type of dealerships
In the State of Georgia, you can operate either as a new car dealer or as a used car dealer. Each case requires a different procedure to start your Georgia dealership.
Starting a new car dealership in Georgia means you need to operate as a franchise of a car manufacturing company. Once you’ve set up your business accordingly, you can also add used car sales by obtaining a specific business license and registering with the Motor Vehicle Division of the Georgia Department of Revenue.
The process for starting a used car dealership is quite different. Here you need to get a proper Georgia dealership license in order to operate legally. The process is thoroughly regulated and you need to meet a variety of requirements to get started.
The Georgia dealership license requirements
Aspiring used car dealers in Georgia need to meet a few licensing requirements and need to pay a non-refundable application fee of $170. The requirements include getting a set office location and a business telephone number, passing a licensing seminar and a criminal background check, obtaining a Sales Tax Identification Number from the Georgia Department of Revenue, and getting $125,000 insurance and a $35,000 Georgia dealer bond.
As a quick reminder, the required surety bond does not protect your business like insurance does. Instead, the bond is a guarantee that your dealership will abide by state regulations. This means it protects contractual obligations and the interests of your customers. When obtaining a dealer bond, you need to pay only a percentage of the bond amount, which is called the bond premium. In the case of Georgia, you need to renew the bond by March 31 on even-numbered years.
Bryant Surety Bonds’ Bad Credit Program
In the competitive and challenging world of auto dealerships, there are still options that make your life easier. The Bryant Surety Bonds’ Bad Credit Program was created with this goal in mind.
A credit score below 650 (down to the bottom of 300) is considered risky. Above 650 up to the maximum of 800, the score is seen as good. Why does credit score matter in getting bonded? It plays a role in the assessment of whether or not you can be issued a bond and in determining the bond premium you will have to pay. The usual bond premium is about 1%-5% of the bond amount. For bad credit applicants, the premium jumps to 5%-10% that sometimes needs to be complemented by posting collateral.
With Bryant Surety Bonds’ Bad Credit Program, you are guaranteed to get a great bonding rate along with the possibility to get bonded even with bad credit. While you might need to pay a slightly higher premium or post a small part in collateral because of your risky credit situation, the program allows your business to get licensed and get in the market. This is a great opportunity for auto dealerships in Georgia that are struggling with obtaining a dealer bond to finally launch their operations and boost their finances.
Ready to get started? You can apply online for your Georgia dealer bond and get a quote in minutes. If you still have any questions regarding the bonding process, we are here to help.