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Washington Motor Vehicle Bond

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How much do vehicle business surety bonds cost in Washington?

The cost of vehicle business surety bonds in Washington vary based on the type of license. Surety bonds for vehicle wreckers, vessel dealers, and registered tow truck operators cost $100 and are issued instantly. However, surety bonds for vehicle dealers, travel trailer manufacturers, and mobile home manufacturers is subject to underwriting, meaning the cost is based on a review of the applicant’s credit by an underwriter. Highly qualified applicants are typically approved to pay as little as 1% of the total amount of their bond.

Bond Type Bond Amount Cost
$1,000 Motor Vehicle Bond Wrecker $1,000 $100
$5,000 Motor Vehicle Bond Vessel Dealer or Registered Tow Truck Operator $5,000 $100
$20,000 Motor Vehicle Bond Travel Trailer Manufacturer $20,000 Starts at $200 GET A QUOTE
$30,000 Motor Vehicle Bond New or Used Vehicle Dealer $30,000 Starts at $300 GET A QUOTE
$40,000 Motor Vehicle Bond Mobile Home Manufacturer $40,000 Starts at $400 GET A QUOTE

Why do I need a Washington motor vehicle bond?

The Washington Department of Licensing requires vehicle businesses to have a surety bond pursuant to Chapter 46.70 of the Revised Code of Washington. The bond must be in the amount required by the license and issued on the form provided by the state (DLR-430-205).

By posting a Washington vehicle surety bond, principals (dealers, manufacturers, tow truck operators and wreckers) pledge to uphold all laws of the state of Washington while conducting business under their specified license. If the principal conducts business unethically and unlawfully and an entity suffers financial loss as a result, the surety will reimburse harmed parties up to the full penal sum of the bond. The principal, in turn, must pay the surety for all damages paid out.

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What types of vehicle businesses need a surety bond in Washington?

Vehicle and vessel dealers, registered tow truck operators, wreckers and vehicle manufacturers must post surety bonds before they can get a license to conduct business in the state.

Motor Vehicle Wreckers

Vehicle wreckers must post a $1,000 surety bond. The state of Washington Department of Licensing considers any business that buys or sells wrecked motor vehicles for the purpose of dismantling them or second-hand motor vehicle parts to be a wrecker, and requires that they are licensed and bonded before they can operate legally.

Registered Tow Truck Operators

Registered tow truck operators required by the Washington Department of Licensing to post a $5,000 surety bond. Any business that transports, impounds, stores unauthorized vehicles, or disposes of abandoned vehicles is considered by the state of Washington to be a tow truck operator and must therefore be licensed.

Vessel Dealers

The Washington State Department of Licensing requires that vessel dealers who sell at least 15 vessels per year with a retail value greater than $2,000 to post a $5,000 surety bond and acquire a vessel dealer license to conduct business legally. Vessel dealers sell boats, yachts, and other types of motorized watercraft.

Travel Trailer and Mobile Home Manudacturers

Any business that manufactures travel trailers is required to be licensed and post a $20,000 surety bond by the state of Washington. Businesses that manufacture mobile homes are also required to be licensed, but they must post a $40,000 surety bond.

Motor Vehicle Dealers

Businesses or auctioneers that sell new or used cars, trucks, or motor homes at wholesale or retail must be licensed and bonded as a Washington motor vehicle dealer. The required bond amount for these professionals is $30,000.

What’s the fine print on a Washington motor vehicle bond?

Vehicle, vessel, vehicle manufacturer, registered tow truck operator or wrecker bonds in Washington are continuous until canceled. The surety can cancel the bond at any time by giving the Department of Licensing written notice of cancellation. Cancellation becomes effective 30 days after the department receives the notice.

This bond form covers vehicle dealers, vessel dealers, vehicle manufacturers, registered tow truck operators and wreckers. Applicants should be sure to indicate the correct license type on the surety bond form.

How to become a vehicle dealer, wrecker, or manufacturer in Washington

Although there are specific licensing requirements for each license type covered by this surety bond, there are a few blanket requirements applicants must fulfill, including posting a surety bond in the proper amount and submitting a completed Business License Application.

Additional Resources

Revised Code of Washington: Chapter 46.70

Washington State Department of Licensing Vehicle, Vessel, Vehicle Manufacturer, Registered Tow Truck Operator, or Wrecker Business Bond form

Washington State Department of Licensing How to get your license: Motor vehicle dealer

Washington State Department of Licensing How to get your license: Vessel Dealer

Washington State Department of Licensing How to get your license: Vehicle manufacturer

Washington State Department of Licensing How to get your license: Registered tow truck operator (RTTO)

Washington State Department of Licensing How to get your license: Wrecker