Oklahoma Auto Dealer Bond Overview
Starting your Oklahoma auto dealership requires obtaining an auto dealer license. If you want to be a used or wholesale car dealer, as well as manufactured home dealer or manufacturer, you’ll also need to obtain an Oklahoma auto dealer bond. The license guarantees your legal compliance with state dealership laws, and the bond is there to protect your customers from potential fraudulent practices of your dealership.
Similarly to other Oklahoma surety bonds, the auto dealer bond is, in practice, a three-party contractual agreement. First there is the principal, which is your dealership, the Oklahoma authority requiring the bond called the obligee, and finally the surety is the party which furnishes the bond.
- Surety Bond Names:
- Oklahoma used motor vehicle dealer’s surety bond
- Oklahoma used motor vehicle dealer auctions’ surety bond
- Oklahoma used motor vehicle rebuilder’s surety bond
- Oklahoma wholesale motor vehicle dealer’s surety bond
- Oklahoma manufactured home dealer’s surety bond
- Oklahoma manufactured home manufacturer’s surety bond
- Surety Bond Amounts:
- $25,000 bond for used car dealers
- $50,000 for used car dealer auctions
- $15,000 bond for used car rebuilders
- $25,000 for wholesale dealers
- $30,000 bond for manufactured home dealer or manufacturer
- Obligee: Oklahoma Used Motor Vehicle and Parts Commission
- Required Expiration Date of Dealer Bond: December 31st of each odd-numbered year
Before you start your bonding process, it’s important to differentiate between surety bonds and insurance. While insurance protects your business, auto dealer bonds are required in order to guarantee that your customers’ interests will be upheld.
If your dealership engages in fraudulent activities, a claim can be filed on your bond. In case it is proven, your business will have to compensate the affected parties up to the penal sum of the bond. At first, the surety that has underwritten your bond will cover the costs, but afterwards you are liable to repay them in full. Thus, the best approach is to make sure you follow your legal obligations, as claims can harm your business financially, besides ruining your dealership’s good name.
Oklahoma motor vehicle dealer bonds can also work for your business. When you get bonded, it’s like an additional line of credit that guarantees your trustworthiness. Customers are much more open to working with secure businesses like yours.
Oklahoma Auto Dealer Bond Cost
Besides getting acquainted how Oklahoma auto dealer bonds work, let’s look into the way your surety bond cost is set.
There are different requirements for the various types of Oklahoma dealerships. Your bond amount will range from $15,000 to $50,000. However, you need to pay only a bond premium, which is a percentage of that amount.
- Premiums of 1% and 3% are the common case for applicants with good credit score, usually above 650.
- If your credit score is between 600 and 649, you can expect to pay premiums between 2% and 4% of the bond amount.
If you have to post a $15,000 Oklahoma auto dealer bond, with good credit your bond premium may be as low as $150.
You can consult the surety bond costs that you can expect to pay in the different credit score ranges in the table below.
||Auto Dealer Bond Cost Based on Credit Score|
|Surety Bond Name||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Oklahoma used car dealer or wholesale car dealer bond||$25,000||$250-$500||$375-$750||$500-$1,000||$750-$1,750|
|Oklahoma used car dealer auctions bond||$50,000||$500-$1,000||$750-$1,500||$1,000-$2,000||$1,500-$3,500|
|Oklahoma manufactured home dealer or manufacturer bond||$30,000||$300-$600||$450-$900||$600-$1,200||$900-$2,100|
|Oklahoma used car rebuilder bond||$15,000||$150-$300||$225-$450||$300-$600||$450-$1,050|
You can get your exact bond cost only after submitting a full Oklahoma auto dealer bond application. Then your surety can assess the strength of your business and financial stats, including your personal credit score. The percentage of the bond amount that you’ll end up paying will be lower if you can showcase solid finances.
The usual factors that sureties take into consideration when you apply for a bond are:
- Personal credit score
- Solidity of assets and liquidity of your business
- Overall financial status
- Professional auto dealership experience
Besides working to improve your finances, make sure you pay the lowest possible bond price, by carefully selecting the surety bond agency that you’ll work with. Here at Bryant Surety Bonds, we are able to offer you outstanding bonding rates. This is due to our partnerships with a number of A-rated, T-listed surety companies. We can shop around for the best bonding option for your specific case.
You can get a quick estimate of your Oklahoma auto dealer bond cost by using our surety bond cost calculator, located in the right sidebar of this page. Your exact bond quote is only a step away. You just need to call us directly at 866.450.3412 or apply online.
Bad Credit Program
After years of getting Oklahoma auto dealers bonded, we know how difficult it can be to obtain your Oklahoma auto dealer bond if your finances are far from perfect. That’s why we offer our Bad Credit Surety Bond Program, to help dealers get bonded and stay in business.
The usual bonding premiums for applicants with a low credit score or tax liens, past bankruptcies, or civil judgments are between 4% and 7%. While the cost of getting bonded is slightly higher, the bad credit program offers a viable alternative for dealers with problematic finances to improve their financial profile over time.
Oklahoma Auto Dealer License and Renewal
Starting your Oklahoma used car, wholesaler, or manufactured home dealership entails following the licensing procedure of the Oklahoma Used Motor Vehicle and Parts Commission. Getting your Oklahoma auto dealer bond is one of multiple steps that you need to complete.
Before you fill in your licensing application, you must select the type of license you need. This Commission regulates the licensing of used motor vehicle dealers, used motor vehicle auction dealers, used motor vehicle rebuilders, wholesale dealers, and manufactured home dealers and manufacturers. There is a separate application form for used motor vehicles, and for manufactured home dealers and manufacturers.
After completing the correct form in full, you’ll be asked to submit the following documents:
- Proof of ownership or lease of your dealership location
- Photos of your office space, sales area, business sign and business hours
- Letter or permit from the city or county proving compliance with all zoning codes
- Initial Salesperson’s Application for each sales agent
- Attendance of the Education Program by at least one owner
- Formation documentation for sole proprietorship, corporation, limited liability company or a partnership
- Financial statements
- Liability insurance
- Proof of payment of applicable fees
- Oklahoma motor vehicle dealer bond as required for your type of license
When you complete your application and furnish all necessary documents, the Oklahoma Used Motor Vehicle and Parts Commission will review and assess your business. In case all conditions are met, you’ll be issued your Oklahoma auto dealer license.
All licenses expire on December 31st of each odd numbered year. For the biennial renewal, you also need to renew your Oklahoma auto dealer bond. As your financial situation changes over time, your surety bond cost will also fluctuate. To guarantee a lower bond cost for your next renewal, it’s worth working on improving your financials and showcasing the strength of your dealership.
Get Your Oklahoma Auto Dealer Bond Today
You can start your bonding process today with no hassle. Just apply online and complete your bond application in a few straightforward steps. For any questions about bonding and your application, call us at 866.450.3412. Bryant Surety Bonds’ experts will be happy to help you out.
Keeping copies of your original Oklahoma auto dealer bond form and the rest of the licensing application documents is a good idea, so you can refer to them if needed.