Louisiana Auto Dealer Bond

Louisiana Auto Dealer Bond Overview

When applying for your dealer license, you are required to obtain a Louisiana motor vehicle dealer bond. So how exactly does the bond work for you?

The auto dealer bond is a contractual agreement between three parties. Your dealership is the principal, the obligee is the State of Louisiana that requires the bond, and the third party is the surety, which underwrites the bond for you.

Louisiana Motor Vehicle Dealer Bond

• Obligee: Louisiana Used Motor Vehicle Commission
• Required Expiration Date of Dealer Bond: 31 December
• Surety Bond: Not continuous, so it requires a Continuation Certificate
• Bond Form Revision Date: 7/2010

Auto Title Company Bond, Public License Tag Agent Bond

• Obligee: Louisiana Department of Public Safety and Corrections’ Office of Motor Vehicles
• Required Expiration Date of Dealer Bond: 31 December
• Surety Bond: Not continuous, so it requires a Continuation Certificate
• Bond Form Revision Date: 8/2006

Besides being a state requirement, the Louisiana auto dealer bond also demonstrates the trustworthiness of your business. It functions like additional surety credit given to your dealership, which guarantees you are capable of complying with all relevant regulations.

If you fail to follow the law, a claim can be filed on your bond. In case the claim is proven, the surety that has underwritten your bond will cover the penal costs up to the bond amount. According to the indemnity agreement signed during the bonding, you’re legally obligated to repay the surety afterwards. While the bond provides a protective layer for your business in case of claims, it’s still very important to avoid them, since they can cause serious financial and reputational harm to your dealership.

Bond Cost in Louisiana

The State of Louisiana requires a $20,000 dealer bond for new car dealers. Used car dealers, on the other hand, need a $50,000 bond. The required bond for an auto title company is $10,000, and for public license tag agent - between $10,000 and $100,000.

Don’t let these bonding amounts worry you, though. Your bond premium, the amount you pay, will only be a percentage of the total amount, which is usually between 1,5% and 3%. For a $20,000 dealer bond, your surety bond premium could be between $300 and $600 per year.

Your premium depends on your overall business and financial status. To reduce the percentage of the bond amount that you have to pay, you can work on a few factors. In terms of finances, improving your credit score and proving your liquidity and assets are very effective in decreasing the bond cost.

You can also save on your premium by carefully choosing your surety bond provider. Here at Bryant Surety Bonds, we work with a number of excellent A-rated, T-listed surety companies. This gives us a strong advantage in finding the best bonding rate for you, since we can shop around for the lowest one.

The surety bond cost calculator on the right side of the page and our surety bond cost page can help you figure out a ballpark estimate for your bond cost.

Bad Credit Program

For Louisiana auto dealers with a low credit score or past bankruptcies, tax liens or civil cases, getting bonded can be an unpleasant or even impossible process.

Here at Bryant Surety Bonds, we operate a bad credit surety bond program to give you a hand in more difficult circumstances. Due to the higher risk involved in bonding applicants with problematic finances, the bond premiums are a bit higher, in the range of 5%-15%.

Still, this is a great opportunity to obtain the legally required bond, so that you can stay in business and get the chance to improve your credit. We’ll provide you with a personalized approach tailored to your specific situation, so that you get the lowest price and best conditions.

Louisiana Dealer Bond Renewal

The auto dealer license in Louisiana expires on December 31st every year. Along with renewing the license, you will also have to obtain a new bond, since the bond in Louisiana is not continuous.

The bond premium you will have to pay will vary from year to year, as it depends on your current financial and business status. This is good news, as it means you can reduce your bond costs over the years!

It’s a good idea to start your renewal process early on in order to ensure your compliance after the expiration date. Getting bonded with Bryant Surety Bonds means that we will take care to send you a reminder well in advance, so you have enough time to complete the renewal.

Get Your Louisiana Auto Dealer Bond Today

To start your bonding process, you just need to apply online for your free, no-obligations quote, or call (866)-450-3412. In case you need assistance with your application, our bond experts are here to help.

You will have to provide a set of financial and business documents, which will help us determine the best possible bonding rate for your dealership. Don’t forget to use the specific Louisiana dealer bond form and to save a copy of the completed bond.

About us:

Bryant Surety Bonds

Bryant Surety Bonds, Inc. is a surety bond agency based in Pennsylvania. Licensed in all 50 states and with access to over 20 T-listed, A-Rated bonding companies, we have the contacts, expertise, and top service to provide you with a hassle-free experience, all while offering competitive rates for your surety bond.