What is a Wyoming Auto Dealer Bond?
A business operating as an auto dealer in the state of Wyoming is likely required to hold a valid license to do so. One crucial component of the licensing process is posting a surety bond, known as a Wyoming auto dealer bond. This type of bond helps protect the public and the state should a licensed auto dealer fail to comply with current laws and regulations surrounding the operation of the dealership.
A customer of an auto dealer or the state's licensing authority has the ability to make a claim against a Wyoming auto dealer bond if legal obligations or requirements are not met by the dealer. Claims can be a costly endeavor for the auto dealer, so having an auto dealer bond helps reduce the potential for fraudulent or otherwise illegal business practices.
Who Needs a Wyoming Auto Dealer Bond?
In Wyoming, any individual or business engaging in the sale, exchange, or purchase of certain motor vehicles is an auto dealer and required to have a license. New and used auto dealers along with motor home and truck dealers must have a Wyoming auto dealer bond to fulfill licensing requirements.
Wyoming Auto Dealer Bond Obligee Details
Like other surety bonds, a Wyoming auto dealer bond represents a three-party contract. The auto dealer is known as the principal of the bond, while the surety company provides the bond to the dealer. The obligee of the bond, or the state department responsible for overseeing auto dealers, is the third party to the contract.
The auto dealer bond obligee in Wyoming is as follows:
Wyoming Department of Transportation
Motor Vehicle Services
5300 Bishop Boulevard
Cheyenne, Wyoming 82009
How Much Does a Wyoming Auto Dealer Bond Cost?
The cost of a Wyoming auto dealer bond depends on both the amount of the bond required by state law and the financial standing of the auto dealer. Any auto dealer that requires a license must post an auto dealer bond of no less than $25,000. However, this bond amount does not represent the cost of the bond.
The surety company that issues a Wyoming auto dealer bond calculates the cost as a percentage of the total bond amount, known as the bond premium. Wyoming auto dealers typically pay between 1 and 10% of the bond total, depending on their credit history. Auto dealers with a strong financial standing have a bond premium that falls on the lower end of this range.
How do You Get a Wyoming Auto Dealer Bond?
To get a Wyoming auto dealer bond, a brief application process must be completed. This is done through a short online form that gathers information regarding the bond amount, bond type, and financial history of the auto dealer. The surety company provides a bond quote based on these details and gives the details necessary to finalize the bonding process. All Wyoming auto dealer bonds expire one year from the date of issue, so it is necessary to renew the bond to stay in compliance.