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Alabama Auto Dealer Bond

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What is an Alabama Auto Dealer Bond?

Throughout the country, businesses operating as licensed car dealerships are required to obtain an auto dealer bond. An Alabama auto dealer bond is a necessity for auto dealerships serving customers in the state. This type of surety bond is required to obtain an Alabama auto dealer license, mandated by the state’s Motor Vehicle Division.

An Alabama auto dealer bond works as a safeguard for car buyers. The bond helps ensure your dealership is operating according to state and federal laws when it comes to buying and selling vehicles. Should a customer be financially harmed when dealing with your business, a claim can be made against your Alabama auto dealer bond.

What Does an Alabama Auto Dealer Bond Cost?

Like other surety bonds, an Alabama auto dealer bond costs a percentage of the total bond amount required by the state. For new and used auto dealers, the state requires a minimum $25,000 bond to be secured. You only pay a portion of this amount, however, typically between 1 and 3%. An auto dealer with strong credit, a track record of responsible business management, and experience in the industry is likely to pay a lower percentage than a dealership without these traits.

An Alabama auto dealer bond may cost a higher percentage, between 5 and 10%, if your personal credit or business financials are not strong. Past liens or court judgments, bankruptcies or foreclosures, and late or missed payments bring down your credit score. These negative marks can lead to a higher rate for your Alabama auto dealer bond because you pose a higher risk to the surety company.

How Do I Get an Alabama Auto Dealer Bond?

Even if credit is an issue, you can still get an Alabama auto dealer bond. You can submit your application easily online and get a fast quote based on the details you provide.


Frequent Questions

What does an auto dealer bond cost?

Costs are a percentage of the bond amount that's required of you, which is based on your personal credit. Use our bond pricing tool to get a quick ballpark estimate.

Can I get a bond with bad credit?

Yes. You can get you approved for a bond regardless of your credit situation. However, the price will increase. You can apply to get an instant approval. As the largest writer of surety bonds in the U.S., we have access to high risk markets that many other agencies do not.

How long does the application take?

It only takes minutes, as we can approve you for your bond instantly online. You can get a no obligation quote on our website at any time.

Can I get auto dealer bond insurance to protect myself?

No. An auto dealer bond does not protect you, it protects the public. However, you can protect yourself or your customers by getting fidelity bonds.


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Jennifer Henson
Our company has been with JW Surety for several years now so when we needed to obtain a bond for a new company, we immediately went to them for help. Our rep, Melissa, was extremely helpful and prompt which made the process extremely easy for me.
David Tillotson
Trying to get a local Surety Bond was like driving a car on three tires. I searched Surety Bonds and found JW Surety Bonds. I got online and filled out the information and with in 30 minutes received a response from Melissa. She was informative, friendly and helpful. One more super satisfied customer.

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