Mississippi Auto Dealer Bond Overview
If you want to become a car dealer in the state of Mississippi you will need to apply for a business license. An important step in obtaining a Mississippi dealer license is obtaining an auto dealer bond.
The Mississippi auto dealer bond is a type of surety bond, which guarantees dealers are compliant with state laws, particularly the Mississippi Motor Vehicle Title Act. It also serves as an extra layer of protection for your customers, who can file a claim against a dealership that engages in fraud or unethical business practices. All car dealers in Mississippi should be well-versed in applicable regulations to make sure they don’t get a claim.
Essentially, this surety bond is a three-party agreement between: the car dealer (principal), the state of Mississippi (obligee), and the bonding company (surety). By underwriting the bond, the surety guarantees the obligee is trustworthy and financially sound.
Let’s take a quick look at the auto dealer bond requirement in Mississippi:
Surety Bond Name: MississippI Auto Dealer Bond (for new-car dealers only)
Surety Bond Amount: $25,000 or
$100,000 for a blanket bond covering multiple locations Obligee: Mississippi Motor Vehicle Commission
1755 Lelia Dr #200
Jackson, MS 39216
Expiration Date of the Bond: N/A
Designated agents, i.e. all other dealers except new-car dealers, need to post a separate surety bond:
Surety Bond Name: Designated Agent Bond
Surety Bond Amount: $15,000
Obligee: Department of Revenue
Motor Vehicle Licensing Bureau
P. O. Box 1140
Jackson, MS 39215
Expiration Date of the Bond: N/A
Read on for more information on fulfilling the auto dealer bond requirement and becoming an auto dealer in Mississippi.
Mississippi Auto Dealer Bond Cost
The total bond amount required in Mississippi is either $25,000 or $15,000. However, this is not the actual cost that a dealer is required to pay. To get bonded, dealers must submit an application with a surety bonds company, which will determine a bond premium based on several factors.
The most important factor is the applicant’s personal credit score. Financial strength, demonstrated either through personal and business financial statements or through the applicant’s asset profile, can also play a big role. Finally, a premium can also be dependent on the applicant’s industry experience. Surety companies usually put more trust into a dealer who has been in business for several years.
Applicants with good credit score fall under the standard market rates of between 1% and 3% of the total bond amount.
|Surety Bond Cost Based on Credit Score|
|Surety Bond Name||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Mississippi Motor Vehicle Dealer Bond||$25,000||$250-$500||$375-$750||$500-$1,000||$750-$1,750|
|Blanket Dealer Bond||$100,000||$1,000-$2,000||$1,500-$3,000||$2,000-$4,000||$3,000-$7,000|
|Mississippi Designated Agent Bond||$15,000||$150-$300||$225-$450||$300-$600||$450-$1,050|
To get the best bond for your situation, it’s also important to work with the right surety bonds agency. Since bonding companies do not work directly with the public, your application must go through an agency. Look for is an agency that has a wide selection of reputable, trusted surety partners.
Bryant Surety Bonds works only with the best A-rated and T-listed sureties in the country, guaranteeing the state of Mississippi will accept a bond underwritten by them. It also means you get the lowest possible rate on your Mississippi auto dealer bond, because we will match you with the bond provider that offers the best quote.
On the right, you will find a surety bonds cost calculator, which will give you an estimation of your bond premium. You can then proceed to apply online or call one of our agents at 866.450.3412 if you have any questions or experience any difficulties.
For more details on what factors determine your surety bond premium, you can head to our Surety Bond Cost page.
Bad Credit Surety Bonds
Since credit score is so important, you might be wondering if it’s to get a Missouri auto dealer bond if you have bad credit. Thank to our Bad Credit Program, the answer is “Yes.” We will do our best to get your application approved despite any credit issues, such as tax liens or civil judgments, and your bond will still be underwritten by the same strong bonding companies.
Since surety bond companies consider bad credit applicants as high-risk, you can expect premiums of between 4% and 7% of the bond amount required. However, obtaining the bond guarantees you will stay compliant, and you can always take steps to reduce your premiums when renewal is due.
Mississippi Dealer License Application and Renewal
In addition to maintaining a valid Mississippi auto dealer bond, dealers need to comply with some other requirements before obtaining their license. Here are some of them:
- Fill out the relevant application form
- Pay applicable fees based on the type of license you are applying for
- Provide a copy of your latest bank statement
- Attach a sketch or pictures of facilities
- Biography of each principal
- Submit criminal offense history
- Submit a manufacturer’s area marketing analysis
Remember that your license needs to be renewed yearly to remain active and the same is true for your auto dealer bond.
At Bryant Surety Bonds we send bond renewal reminders to all of our clients, so you can focus on your work and not worry about missing deadline and staying compliant.
Get your Mississippi Auto Dealer Bond Today
Now that you have all the necessary information you need to obtain a Mississippi auto dealer bond, you can start the process by submitting our online application form. We’ll respond as soon as we can with a bond quote.
Once we get your bond underwritten, we will send you the original bond form, which you should attach with your licensing application. Keeping copies of your bond forms is always a good idea, and you can always request them via fax or email.
As always, our surety bonds agent are there to help you out if you have any problems. Just call us at 866.450.3412.