California Auto Dealer Bond

California Auto Dealer Bond

 

How Much Does A California Auto Dealer Bond Cost?

This is the question we hear the most as soon as we answer the phone.  I wish there was a simple answer for this.  However, the fact is that rates can vary greatly depending on several factors.  First, the credit rating of the owners will have the greatest impact on the premium or price paid for the surety bond.  Simply put, the better the credit rating, the cheaper the cost of the bond.  However, this is not the only factor to take in when purchasing a California auto dealer bond.  Have you had a claim in the past?  If so, and an insurance has paid out a claim, chances of you being able to obtain will be pretty slim.

California auto dealer bonds (Retail) will range from .8% to 20% of the penalty amount which is currently set by the state at $50,000. This amount cannot be more nor can it be less.  In short, an applicant with good credit and that has been in business for a few years can expect to pay between $400 and $1000 per year.  Those with credit problems can probably expect to pay between $1000 and $5000 depending on how bad the personal credit is.  We usually give multiple year discounts on your dealer bond so be sure and look for the 2 year discounted quote offer on your invoice and renewals.  Apply Now

Do I Need A California Auto Dealer Bond?

The State of California has 2 different auto dealer licenses that require a surety bond.  The first is the $10,000 surety bond of motorcycle dealer, motorcycle lessor-retailer, all-terrain vehicle dealer, or wholesale-only dealer (selling less than 25 vehicles per calendar year).  The other is the more common $50,000 retail auto dealer bond.  This surety bond is for those businesses that sell to the public and sell more than 25 cars per year.     Apply Now

What Does My Personal Credit Have To Do With The Auto Dealer Bond Premium?

Premiums of the California auto dealer bond will be greatly based on the owners personal credit score.  This is because if a surety company has to pay out a claim, they want to make sure the applicant has a good track record of paying that debt back.  Unlike insurance, if you have a valid claim on your auto dealer bond, the insurance company will look to the applicant to repay the debt.  Untimely payments on your report will result in a higher bond premium.    Apply Now

When Does The California Auto Dealer Bond Expire?

California auto dealer surety bonds expire throughout the year.   In other words, if your bond starts on April 1st, then it will expire on March 31st.  However, there is no “expiration date” on the bond form.  This is because of what is called a continuous bond.  A continuous bond means that is technically does not expire.  The surety company must submit a cancellation notice to the state for non-payment, claim activity or other reasons.  If you do not pay for your renewal in a timely manner, the insurance company will file a “notice to cancel” with the State of California Department of Motor Vehicles.  You will then have 30 days to make payment or risk being shut down by the state.   Apply Now

I Just Purchased My Auto Dealer Surety Bond…Now What?

There are a couple ways to handle the bond after you have purchased it from Absolute Surety.  We can either send you the original Califonia auto dealer bond by mail or send it directly to Sacramento.   Apply Now

The auto dealer bond is also known as the “MVD Bond, motor vehicle dealer bond, auto dealership bond, car dealer bond, etc.  No matter what you call them…we can write them!