How Much Does a New York Auto Dealer Bond Cost?
Used car dealerships in New York need to secure an auto dealer bond, with options of $25,000 or $100,000, while franchised dealerships require a $50,000 bond. It's important to note that licensed auto dealers don't have to pay the full bond amount upfront. Instead, they can pay a percentage, typically ranging from 1% to 10%, to obtain their New York auto dealer bond. This means you can get bonded for as little as $250.
|Bond Amount||Dealer Type||Previous Year Vehicle Sales|
|$25,000||Retail or Wholesale Motor Vehicle Dealer (other than new)||50 or fewer vehicles|
|$100,000||Retail or Wholesale Motor Vehicle Dealer (other than new)||More than 50 vehicles|
The cost of an auto dealer bond is determined by both your credit score and your business's financial stability. If you have a poor credit history marked by civil judgments, liens, debt delinquencies, or bankruptcy, you are considered a higher-risk bondholder. Consequently, your bond premium will be elevated compared to those with strong or excellent credit in the auto dealership industry.
How Do You Get a New York Auto Dealer Bond?
Before proceeding with your application for a motor vehicle dealer license and the associated application fee, you must obtain a New York motor vehicle dealer bond provided by the NY Department of Motor Vehicles. This entails submitting a bond application to a surety company.
We had a memorable experience with a client named David. David always wanted to run his own used car dealership in New York. Determined to start a business, David contacted us asking for all the bonding information needed.
We worked hard to fulfill his unique requirements, understand the characteristics of his projects, and the financial status of his business. Our team of professionals delivered tailored assistance, explaining the details associated with a New York auto dealer bond.
We were able to expedite the approval process for David, thanks to our strong relationships with reputable surety companies. David was particularly impressed with our transparent approach, as we outlined the premium costs, terms, and conditions upfront, ensuring there were no hidden fees or surprises.
Who Needs a New York Auto Dealer Bond?
Individuals and businesses engaged in selling motor vehicles for a profit are required to hold a valid auto dealer license in New York. A New York auto dealer bond is necessary as part of the licensing application process for franchised dealers as well as used auto dealers.
Dealers exclusively involved in the sale of trailers, motorcycles, boats, snowmobiles, or vehicles over 10,000 lbs. are not required to obtain a surety bond.
New York Auto Dealer Bond Term and Expiration Date
New York auto dealer bonds have a two-year term, in line with the auto dealer’s license expiration date. This means that bi-annually, licensed motor vehicle dealers must renew their New York auto dealer bond to remain in compliance with state laws and regulations.
What is a New York Auto Dealer Bond?
In New York, to secure an auto dealer license, having a surety bond is a requirement. A New York auto dealer bond is a guarantee that a licensed auto dealership will work with customers according to state laws. If the dealer does not act in accordance to the terms of his surety bond, a claim can be made against it.
Frequently Asked Questions
Yes. You can get your approval for a bond regardless of your credit situation. However, the price will increase. You can apply to get 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.
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.