Alabama Auto Dealer Bond

A $50,000 Alabama auto dealer bond generally costs $500 - $2,500. 

This bond’s cost varies mainly due to an applicant’s credit score. However, other factors can also impact cost, such as industry experience and positive past bonding history. For example, an auto dealer with solid credit and a track record of responsible business management is likely to pay a lower percentage than a dealer without these traits. 

Another factor that influences this bond’s cost is the surety company. At JW Surety Bonds, we can offer the lowest prices in the industry due to the large volume of bonds we underwrite. Recently, we were able to get our Alabama client, William, his auto dealer bond for 2% less than he paid with his previous surety. 

• Learn more through our guide: What Does a Surety Bond Cost?. 

1. Submit Your Application

Filling out an online application is the quickest and easiest way to apply for an Alabama auto dealer bond. It is available 24/7 and generates an instant quote.

Information you will need to complete this online form includes:

• Bond Name (Alabama Auto Dealer Bond)
• Bond Amount ($50,000)
• Contact information, including email

Prefer to apply over the phone? Call one of our surety experts at (888)-592-6631.

2. Get a Quote

Our online application generates a quote within minutes, which is sent directly to your email. To purchase, fill out the provided forms and pay your invoice. 

3. Get Your Bond

A copy of your Alabama auto dealer bond will be emailed your way once your payment clears. Please double-check that all information on the bond form is correct. If there is a mistake, contact us immediately. 

The original bond will be sent to you by mail.

All auto dealers in Alabama must be licensed through The Alabama Department of Revenue Motor Vehicle Division. A main requirement to get this licensing is securing a $50,000 auto dealer bond. 

The purpose of this bond is to keep customers who buy and sell cars at the auto dealership safe from fraud and unethical behavior. In cases where a dealer conducts business unlawfully, the bond reimburses the customer for any losses. See How Do Surety Bonds Work? for more details. 

Alabama auto dealers that must be bonded include:

• New motor vehicle dealers
• Used motor vehicle dealers
• Trailer dealers
• Motorcycle dealers
• Wholesale dealers
• Reconditioners and rebuilders

Alabama Auto dealer bonds must be renewed yearly by September 30th. This date aligns with the renewal deadline for Alabama auto dealer licenses. 

• When your bond is up for renewal, your surety company will send you a notice 30 days or more before the expiry. They will also provide instructions on how to pay your new invoice to get your bond continuation certificate. 

Please note that it is imperative for a bond to be renewed/remain active for as long as the auto dealer is in business. An invalid bond can result in the cancellation of licensing.

If someone files a bond claim in Alabama, the claim will be investigated. This procedure is in place to check that:

1. The bond claim is valid, so the bond holder isn’t paying for false accusations.
2. That the claim made falls under the bond’s coverage.

You will be contacted for further information if a claim is made against your bond. You may need to provide documentation or other information for your defense. In the event that a claim is valid, your surety company will initially pay. However, you are then required to pay them back in full.

All Alabama Auto Dealer Licenses are processed through the Department of Revenue. To get this license, you will need the following:

• Permanent business location – you must include photos of your signage, lot, and more in your application. 
• Blanket liability insurance – required for all vehicles connected to your business.
• Sales tax number – issued by The Alabama Department of Revenue. 
• Surety bond – a $50,000 auto dealer bond from a surety licensed to do business in AL.
• Verifiable phone listing.
• Fees – varies depending on your city’s population. 

See our Alabama Auto Dealer License Guide for more information.