Anyone planning to sell motor vehicles in North Dakota must first obtain the proper dealer license. As part of the licensing process, most applicants are required to secure a North Dakota auto dealer bond before operating legally.
This surety bond protects customers, lenders, and the state of North Dakota if a dealer violates state law, misrepresents vehicle information, or fails to fulfill contractual obligations. Maintaining an active bond is a mandatory condition of holding a valid dealer license.
North Dakota Auto Dealer Bond at a Glance
- Purpose: Protects consumers and ensures compliance with North Dakota dealer laws
- Who Needs It: Most new, used, trailer, recreational vehicle, and manufactured home dealers
- Regulating Authority: North Dakota Department of Transportation (NDDOT), Motor Vehicle Division (MVD)
- Bond Amount: $10,000 – $50,000 (varies by dealer type)
- Bond Form: Continuous (premium billed annually; dealer license renews annually by Dec. 31)
- Premium Rate: Typically starts around 1% for well-qualified applicants
How Much Does a North Dakota Auto Dealer Bond Cost?
North Dakota sets bond amount requirements based on license classification:
| Bond Type | Required Bond Amount | Estimated Starting Cost |
|---|---|---|
| Motor Powered Recreational Vehicle Dealer | $10,000 | Starts at $100 |
| Trailer Dealer | $10,000 | Starts at $100 |
| New Motor Vehicle Dealer | $25,000 | Starts at $250 |
| Used Motor Vehicle Dealer | $25,000 | Starts at $250 |
| Mobile Home / Manufactured Home Dealer | $50,000 | Starts at $500 |
Although the state sets the bond amount, dealers do not pay the full amount up front. Instead, you pay a bond premium, which is only a small percentage of the total bond.
Surety companies evaluate:
- Personal and business credit history
- Financial stability
- Business assets and liabilities
- Experience operating a dealership
Typical Rate Ranges
- Applicants with strong credit: 1%–3% of the bond amount
- Applicants with average credit: 3%–5%
- Higher-risk applicants: May approach 5%–10%, depending on underwriting
Even if your credit profile is not ideal, bonding is often still possible through our Bad Credit Surety Program, designed for higher-risk applicants.
To get an instant ballpark estimate of how much your bond premium will be, use our Surety Bond Cost Calculator below:
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Get a free exact quote Get another estimateHow to Get a North Dakota Auto Dealer Bond
- Submit a quick online application.
- Review your personalized quote.
- Finalize and issue your bond – Once approved and payment is processed, your official North Dakota auto dealer bond is issued and ready for submission with your dealer license application.
Many North Dakota dealers are able to complete the bonding process within one business day, minimizing delays in licensing or renewals. Bryant Surety Bonds is authorized to issue surety bonds in North Dakota (license #3000587381) and partners with nationally recognized surety carriers known for responsive underwriting and reliable turnaround times.
How Do You Get a North Dakota Auto Dealer License?
To operate as one of the licensed North Dakota car dealerships, applicants must submit required documentation to the North Dakota Department of Transportation. While requirements vary by dealer type, most applicants must provide:
- Surety bond in the correct amount
- Proof of garage liability insurance
- Completed dealer license application
- Established business location that meets zoning requirements
- Trade name registration with the North Dakota Secretary of State (if operating under a different business name)
- Required licensing fees
Applicants should confirm the appropriate license classification before applying, as bond amounts vary by dealer type.
The NDDOT may not renew a dealer license for any applicant who made fewer than eight retail motor vehicle sales during the previous year. (This threshold was raised from four to eight by Senate Bill 2120 in 2019.) Dealers who fall short of the minimum should plan accordingly, as failing to meet it can prevent renewal even if all other requirements—including an active surety bond—are in good standing.
For more information, please visit our dedicated North Dakota Auto Dealer License Guide.
North Dakota Auto Dealer Bond Renewal
Under NDCC 39-22-04, the North Dakota dealer surety bond (SFN 2933) is continuous in form and remains in effect until the surety provides 30 days’ written notice by certified mail to both the principal and the NDDOT Motor Vehicle Division in Bismarck. The dealer license itself expires December 31 of each year (NDCC 39-22-18) and must be renewed by that date; failure to submit a timely renewal triggers a $100 late fee, and renewal requires at least eight retail motor vehicle sales during the previous year. The bond premium is billed annually, but the bond instrument itself does not expire on its own. If the surety cancels and a replacement bond is not filed before the 30-day notice period ends, the dealer license may be suspended until coverage is restored. With Bryant Surety Bonds, the annual premium is billed in advance so coverage stays continuous, and there is no operational change for the dealer at renewal.
FAQs
Can my North Dakota auto dealer bond be canceled?
Yes. Per the SFN 2933 bond form, a surety may cancel a North Dakota dealer bond by providing 30 days’ written notice by certified mail to both the principal (the dealer) and the NDDOT Motor Vehicle Division in Bismarck. If a replacement bond is not filed before the cancellation date, the dealer license is subject to suspension.
Do I need a new bond if I change my dealership’s ownership structure?
If you form a new legal entity or transfer ownership to a different business entity, a new bond is required. Bonds are issued to a specific legal entity and cannot simply be reassigned.
When does my North Dakota auto dealer bond become effective?
The bond becomes effective on the date listed on the bond form once it is issued and properly filed with the state as part of the dealer licensing process.
Can I operate while waiting for my bond approval?
No. The North Dakota auto dealer bond must be issued and filed before your dealer license can be approved and before you can legally sell vehicles.
How long does it take to get a North Dakota auto dealer bond?
Usually within a single business day. Most applicants are quoted on the same business day they apply, and once you accept the terms and complete payment, your official North Dakota dealer bond (SFN 2933) is typically issued within 24 hours. Because the NDDOT requires the original signed bond, choose overnight shipping if you are working against a tight licensing deadline.
Does obtaining an auto dealer bond quote affect my credit score?
No. Sureties evaluate your application using a soft credit inquiry, which has no effect on your credit score and does not show up on the credit report lenders pull when you finance inventory or apply for other business credit.
Can I get a North Dakota auto dealer bond if I have bad credit or past financial issues?
Yes, in most cases. Bryant Surety Bonds’ Bad Credit Surety Bond Program is built for applicants with low credit scores, prior bankruptcies, tax liens, or other financial setbacks that traditional sureties tend to decline. Premiums in this program typically run 5%–10% of the bond amount rather than the standard 1%–3%, but most higher-risk applicants are still able to secure the bond they need to obtain or renew an NDDOT dealer license.
Are installment options available for paying my North Dakota auto dealer bond premium?
Unfortunately, no. Auto dealer bond premiums are paid in full up front for the annual term, which is the standard practice across the surety industry. For a well-qualified applicant, the $10,000 trailer or recreational vehicle dealer bond starts around $100 per year, the $25,000 motor vehicle dealer bond starts around $250 per year, and the $50,000 mobile or manufactured home dealer bond starts around $500 per year, so most operators absorb the premium in a single payment.
