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New York Auto Dealer Bond

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What is a New York Auto Dealer Bond?

Businesses that operate as new or franchised auto dealerships in the state of New York are required to hold a valid auto dealer license. As part of the licensing requirements, a New York auto dealer bond is also necessary. A New York auto dealer bond is a guarantee that a licensed auto dealership will work with customers according to state laws. If a customer suffers financial harm when dealing with a dealership, a claim can be made against its New York auto dealer bond.

A bond is a form of security that is structured as a three-party contract between a principal, an obligee, and a surety. The principal is the auto dealership required to secure an auto dealer bond. The obligee is the state’s licensing authority; in New York, this is the New York State Department of Motor Vehicles. Finally, the surety is the company providing the bond guarantee to the principal.

What Does a New York Auto Dealer Bond Cost?

A New York auto dealer bond of either $25,000 or $100,000 is required for used car dealerships, while a $50,000 bond is necessary for franchised dealerships. However, a licensed auto dealer is not required to pay the entire amount of the bond. Only a percentage of the bond amount is paid to obtain a New York auto dealer bond, ranging from 1 to 10%.

The price you pay for an auto dealer bond depends on your credit score and your business financial standing. Poor credit due to civil judgments, liens, missed payments on debts, or bankruptcy means you are a higher risk bondholder. Because of this risk, your bond premium will be higher than for auto dealers with strong or excellent credit.

How Do You Get a New York Auto Dealer Bond?

You can start the process of securing a New York auto dealer bond by submitting a brief form online. The surety company will provide a fast quote for your bond, as well as instructions on how to complete the bonding application.

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 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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