California Auto Dealer Bond
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How much does a California auto dealer bond cost?
California auto dealer surety bond costs vary depending on which auto dealer license type you need. Your exact premium will be provided after a quick application review.
- Annual premiums for the $10,000 Motorcycle, Lessor-Retailer, All-Terrain, or Wholesale Vehicle Dealer Bond start at $100.
- Annual premiums for the $50,000 Motor Vehicle Dealer Bond start at $500.
Multi-year discounts are also available for qualified applicants who would like to extend their bond term.
How do you get a California motor vehicle dealer surety bond?
You can apply for your California motor vehicle dealer bond online 24/7. Simply select which bond you need and provide the following information for Department of Motor Vehicles filing approval.
- name, including any applicable DBA
- dealer/lessor/retailer service address
- dealer license number, if available
Once your order has been processed, you'll receive a copy of your bond by email, and your official vehicle dealer bond will be shipped to your preferred mailing address.
How fast can I get an auto dealer bond?
Our industry-leading technology and responsive customer service team allow us to deliver your official California auto dealer bond faster than any other surety provider. The DMV requires your California auto dealer bond be physically issued and shipped to you, so choose overnight shipping during checkout if you're in a rush. Orders placed by 4 PM CST Monday-Friday are typically shipped same-day.
If you have questions about the California auto dealer bond or your application, call 1(800)308-4358 to speak with one of our friendly surety experts. We're here to guide you through the dealer bond process so you can get back to running your business.
What is a California motor vehicle dealer bond?
California Vehicle Code Division 5 Chapter 4 Section 11710 requires individuals file a surety bond before working as a licensed dealer in the state. Individuals who will work as a general or wholesale dealer, manufacturer, remanufacturer, transporter, or distributor must file a surety bond in the correct amount when submitting their dealer license application. The bond must remain active and on file with the state for the duration of the business license.
The $50,000 Form OL 25 is officially titled the “Dealer Surety Bond” whereas the $10,000 Form OL 25 B is officially titled the “Surety Bond of Motorcycle Dealer, Motorcycle Lessor-Retailer, All-Terrain Vehicle Dealer, or Wholesale Only Dealer (Less than 25 Vehicles per Year)." However, these bonds are more commonly known as "auto dealer bonds," "motor vehicle dealer bonds," or even just "dealer bonds."
Watch the video below to learn more about California auto dealer bonds.
What are the terms of a California motor vehicle dealer surety bond?
By filing this bond, dealers agree to operate their dealerships according to California Code Section 11711, which is the state's “Vehicle Code.” If they fail to comply with the outlined terms, harmed individuals - particularly consumers - can file a claim against the bond. The surety company will pay valid claims up to the full bond amount, which the bonded dealer must reimburse.
The California Department of Motor Vehicles requires this bond for auto dealer licensing. If you're trying to register a vehicle with a missing title, you need a separate California defective title bond.
What parties are involved in an auto dealer bond in California?
As the bond's “obligee,” the California Department of Motor Vehicles requires motor vehicle dealers file a surety bond before they can be licensed to work in the state. As the bond's “principal,” the auto dealer files the bond as a guarantee they'll operate according to regulatory laws. As the bond's "surety," the insurance company issues the bond and backs the dealer's guarantee to fulfill their obligations.
What are the types of California auto dealer bonds?
California defines a "vehicle dealer" as an individual or business that sells new or used vehicles, motorcycles, snowmobiles, ATVs, or trailers either full or part-time. Wholesale dealers are defined as exclusively selling vehicles between licensed dealers.
The DMV requires general motor vehicle dealers to file a $50,000 auto dealer bond while motorcycle dealers, motorcycle lessor-retailers, all-terrain vehicle dealers, and wholesale-only dealers must file a $10,000 auto dealer bond.
How do I update my auto dealer bond form?
If the California DMV requires your surety bond documentation to be updated for any reason, contact your surety provider. If you purchased your California surety bond from SuretyBonds.com, email [email protected] to explain the needed change. The most common changes requested are updating the dealer or dealership's name or address.
How do I renew my motor vehicle dealer bond?
You must renew your California auto dealer bond before its current term expires. Once you pay your SuretyBonds.com renewal invoice, instructions will be provided to keep your bond active for your next auto dealer license term.
How can you get a California auto dealer license?
Learn How To Get A California Auto Dealer License by reviewing our comprehensive guide.
To become a licensed dealer in California, follow the New Dealer Application Checklist or the Used and Wholesale Dealer Application Checklist.
- Fill out all forms in the New Dealer Applications Forms Packet or Used Dealer Applications Forms Packet.
- Complete the live scan fingerprint process, and submit a Request for Live Scan Clearance.
- Get a fingerprint card (ADM 1316) for out-of-state applicants only. Call the Occupational Licensing Office at 1(916)229-3126 to get a card.
- Submit a copy of the California Department of Tax and Fee Administration Resale Permit.
- Take and submit photos of the dealership.
- Complete the Dealer Education Program, and submit a Certificate of Completion (used vehicle dealer and wholesale-only dealer).
- Pass the DMV Used Dealer Test and submit proof of passing (used vehicle dealers only).
- Submit a Letter of Authorization (new trailer dealers only and required for each line).
- File a Statement of Information (SI 550) or Statement of Information LLC (LLC 12) with the California Secretary of State (corporation, limited liability company, or limited liability partnership owned businesses only).
- Pay the following application fees.
$175 nonrefundable original application fee
$1 family support program fee
$70 per branch location
$92 per dealer plate
$94 per motorcycle plate
$300 new motor vehicle board fee
$100 autobroker's endorsement fee
$42 fee per fingerprint card (out-of-state applicants only)
$16 examination fee
Once you've completed all forms and documents, set up an appointment with a California Occupational Licensing Inspector Office. Visit the DMV Vehicle Dealer License page to learn more about the application and license renewal process.
Have Questions?
Call 1 (800) 308-4358 to talk with a Surety Expert today.
