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Nebraska Auto Dealer Bond

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What is a Nebraska Auto Dealer Bond?

When an individual or business wants to sell motor vehicles in the state of Nebraska, it is likely operating as an auto dealer. Under current regulations, an auto dealer in Nebraska is required to hold a valid license in order to operate legally. One aspect of the licensing process involves obtaining a surety bond, known as a Nebraska auto dealer bond.

An auto dealer bond is meant to protect both the state and the buying public from business activities of the auto dealer that do not comply with state laws. Should the licensed auto dealer fail to meet its obligations to the state or a customer, a claim can be made against a Nebraska auto dealer bond. These claims can be costly for an auto dealer, so having a bond in place is designed to deter fraudulent or misleading business practices.

Who Needs a Nebraska Auto Dealer Bond?

Anyone who engages in the sale of motor vehicles is considered an auto dealer in Nebraska, and therefore, must have a valid license and corresponding auto dealer bond. New and used auto dealers, as well as trailer dealers and motorcycle dealers, are required to maintain a bond for as long as they plan to be in the auto dealer industry.

Nebraska Auto Dealer Bond Obligee Details

A Nebraska auto dealer bond connects three different parties under a contract. The first is the licensed auto dealer required to hold the bond, known as the principal of the bond. The second is the surety company providing the bond to the auto dealer. Finally, the state licensing authority responsible for overseeing auto dealers operating in Nebraska is the obligee of the bond.

In Nebraska, the obligee of an auto dealer bond is as follows:

Nebraska Motor Vehicle Industry Licensing Board

Nebraska State Office Building

301 Centennial Mall South

Lincoln, Nebraska 68509

Phone: 402-471-8606

How Much Does a Nebraska Auto Dealer Bond Cost?

All auto dealers in Nebraska must have a bond of $50,000 in order to comply with current regulations. However, this is not the price paid for a Nebraska auto dealer bond. The surety company, instead, prices a bond as a percentage of the total bond amount required, based on the financial details and credit history of the dealer.

A Nebraska auto dealer bond, like other surety bonds, is a form of credit extended to the auto dealer. When claims are successful, the surety company pays the claim amount up to the limit of the bond, but the auto dealer is ultimately responsible for repaying these amounts. For this reason, credit history and financial stability of the dealer is crucial in pricing the bond. For most Nebraska auto dealers, the price of a bond ranges from 1 to 10% of the bond total. Auto dealers with strong credit and stable financials are likely to pay a lower percentage than those with bad credit.

How do You Get a Nebraska Auto Dealer Bond?

Auto dealers in Nebraska can start the process of obtaining a bond by filling out a short application online. The surety company reviews the application details, including the bond amount and financials of the individual or dealership, and provides a bond quote. Once the bond is paid for, information is sent to the obligee of the bond to finalize the process. Nebraska auto dealer bonds must be renewed by December 31 of each year to ensure ongoing compliance with state law.

Frequent Questions

What does an auto dealer bond cost?

Costs are a percentage of the auto dealer 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 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.
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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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About JW Surety Bonds
We are a family owned and operated agency established in 2003. We started with just two people, and grew to become the largest volume bond producer in the nation with 50+ employees. Since day one, our team focus has been on providing real-time online quotes, an easy process, and the best in claims defense. Learn more about our company.