The license puts you in business. The bond keeps buyers trusting you.
The bond your dealer license depends on
Before a state will issue or renew a motor vehicle dealer license, it almost always requires a dealer bond. It guarantees that you will run the dealership lawfully — pay your title and sales taxes, deliver clean and valid titles, and deal honestly with customers. If you don’t, a harmed buyer or the state can claim against the bond.
What a motor vehicle dealer bond guarantees
A dealer bond protects car buyers and the state — not your dealership. It guarantees you will comply with your state’s motor vehicle and dealer laws: remitting taxes and fees, providing clear title, and avoiding fraud or misrepresentation in sales. If the surety pays a valid claim, you must reimburse it in full. It is a licensing and consumer-protection requirement, not insurance for your business.
How much a dealer bond costs
The bond amount is set by your state (and often your dealer type — franchised new-car, used/independent, wholesale, and motorcycle dealers frequently carry different amounts). The premium you pay is a small percentage of that amount — typically around 0.5%–2% for dealers with reasonable credit, more for weaker credit. On a $50,000 bond that is often a few hundred dollars a year. Many states issue the bond on a two-year term.
Requirements vary by state and dealer type
Amounts range widely — commonly $10,000 to $100,000+ — and even whether a bond is required can depend on your classification (franchised new-car dealers are sometimes exempt or bonded at a lower amount). Because the DMV/MVD sets the figure and the rules by state, the right first step is confirming your exact requirement, which we do before quoting.
Motor Vehicle Dealer Bond requirements by state
The required amount and authority differ by state — and sometimes by city or county. Select your state below for the specifics, or request a quote and we will confirm the exact requirement that applies to you.
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- District of Columbia
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- West Virginia
- Wisconsin
- Wyoming
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
Frequently Asked Questions
How much does an auto dealer bond cost?
You pay a premium equal to a small percentage of the required bond amount — typically about 0.5%–2% per year for dealers with reasonable credit. On a $50,000 bond that’s often a few hundred dollars annually. The exact figure depends on your state’s required amount and your credit.
Does a dealer bond protect my dealership?
No. It protects your customers and the state if you violate dealer or motor-vehicle law. If the surety pays a claim, you must reimburse it. You still need garage liability and other coverage to protect the business itself.
What bond amount does my state require?
It varies by state and often by dealer type — commonly $10,000 to $100,000 or more. Tell us your state and dealer classification and we’ll confirm the current required amount.
Can I get a dealer bond with bad credit?
Usually yes. Credit affects your premium rate, not always your eligibility. We work with multiple surety markets, including programs for credit-challenged applicants.
How do I get a motor vehicle dealer bond through Cory Washington & Co.?
Request a quote or contact our team. We confirm your exact requirement, market your bond across multiple surety companies that compete for it, and handle the filing. Cory Washington & Co. LLC is licensed in all 50 states.
All surety bond descriptions on this website are provided by Cory Washington & Co. LLC strictly for general informational purposes. They are not intended to be, and should not be relied upon as, legal, financial, or bonding advice. Surety bonds are not insurance. Bond requirements — including amounts, obligees, and bond forms — are set by government authorities and other obligees and change over time; the information presented is general in nature and does not guarantee the availability, terms, conditions, or amount of any bond. Actual bond terms are governed by the bond form issued by the surety and the requirements of the obligee, and any bond remains subject to underwriting approval. Nothing on this website creates or implies an agent-client relationship, binds a surety, or issues a bond. Cory Washington & Co. LLC expressly disclaims any liability for actions taken, or not taken, based on the content provided here. For advice regarding your particular situation, please confirm current requirements with the relevant authority and consult directly with a licensed professional at Cory Washington & Co. LLC.