Rhode Island Auto Dealer Bond Overview
- Purpose: To guarantee auto dealerships uphold state laws and regulations
- Who Needs It: All auto dealers in Rhode Island that sell more than four cars per year
- Regulating Body: The Rhode Island Department of Revenue, Division of Motor Vehicles
- Bond Amount: $50,000
- Minimum Price: $500; credit-based
What Is a Rhode Island Auto Dealer Bond?
A Rhode Island auto dealer or motor vehicle dealer bond is a financial guarantee that dealers will operate ethically and lawfully.
By filing this $50,000 bond, dealers agree to operate their business according to the Rhode Island dealer license laws.
Who Needs an Auto Dealer Bond?
The Rhode Island Department of Revenue – Division of Motor Vehicles requires auto dealers who sell four or more cars in a year to be licensed and file $50,000 in bond coverage.
How Much Do Dealer Bonds Cost in Rhode Island?
The $50,000 Rhode Island vehicle dealer bond premium starts at $500. Exact rates vary between 1% and 10% based on personal credit history. Apply for your free quote now.
SuretyBonds.com offers the lowest available rates from our nationwide provider network with no added fees.
How Does a Rhode Island Auto Dealer Bond Work?
As with all surety bonds, a vehicle dealer bond is a financial guarantee and legal contract between three parties.
- Principal: The dealer filing the bond
- Obligee: The Rhode Island Dealers' License and Regulation Office
- Surety: The issuing surety provider
The surety acts as a neutral third party. It financially backs the dealer’s obligation to the Dealer’s License and Regulation Office.
If a harmed customer files a claim on the bond, the surety will validate it then reimburse them up to $50,000. As the bonded principal, you must repay the surety.
How Do I Get My Bond?
We make getting a vehicle dealer bond in Rhode Island faster and easier than any other provider. Just follow these steps to get bonded:
- Apply: Fill out the online quote request form. We’ll send your quote in under one business day.
- Buy: Provide any information and signatures as requested and complete the online purchase.
- File: After receiving your original bond form, submit it to the state along with your license application at the address below.
Dealers' License and Regulation Office
600 New London Avenue
Cranston, RI 02920
If you have any questions along the way, give your friendly surety experts a call at 1(800) 308-4358.
Can I Get Bonded With Bad Credit?
You may still be able to get a Rhode Island dealer bond with poor personal credit. However, bad credit can result in a higher bond premium. Apply today to see if you qualify.
How Do I Renew My Bond?
You must maintain an active bond as long as you have an auto dealer license. These bonds expire annually on December 31. You’ll get reminders before your bond expires.
Simply pay the renewal invoice to extend your bond coverage for another term.
How to Become an Auto Dealer in Rhode Island
Complete the following steps to apply for your vehicle dealer license:
- Establish a permanent business location.
- Get business name approval from the Dealers' License and Regulations Office. It must include the phrase “Auto Sales.”
- Submit a notarized application form with all required supporting documents.
- File a $50,000 surety bond.
- Pay all required fees.
Note: Corporate and franchise vehicle dealers must also submit articles of incorporation and letters of intent.
Once the state receives your application, you’ll be scheduled with the Dealer's Hearing Board. If granted a license, you'll be asked to provide any additional documents and pay any remaining fees within 30 days.
During this time, you will also:
- Call the licensing aide at 1(401)462-5732 to request your license and plate numbers.
- Contact the Division of Taxation to get your sales tax permit and blue forms.
- Get insurance for dealer plate insurance coverage and submit the original certificate to the Financial Responsibility Office.
- Fax the Dealers' License and Regulation Office at 1(401)462-5789 to review a blank bill of sale.
