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Surety Bond Details
Cost: VARIES
Motor Vehicle Dealer Bond – Independent Dealer | ||
|---|---|---|
Category: | Auto Dealer Bonds | |
Obligee: | Florida Department of Highway Safety and Motor Vehicles | |
Amount: | $25,000 | |
Duration: | Yearly | |
Expiration: | April 30th | |
Florida Motor Vehicle Dealer Bond Independent Dealer ($25,000) A motor vehicle dealer Bond, sometimes also called a DMV Bond, used car dealer Bond, or auto dealer Bond is required by the State of Florida Department of Highway Safety & Motor Vehicles and guaranty that the motor vehicle dealer complies with all federal laws, state laws, local laws, and tax and judgment guidelines that relate to motor vehicles. The Bond also ensures that if the dealer or any of its employees commit fraud or other wrongful actions, the consumer is protected from any consequence arising from those actions. In addition to the protection a consumer receives from a motor vehicle dealer Bond, they also find peace of mind knowing that a dealership has a Surety Bond in place. That Surety Bond means that a third-party Bonding company has reviewed that dealership's financial information and endorsed them as a financially stable company. To learn more about the state of Florida's requirements, please visit the state of Florida's website at http://www.flhsmv.gov/dmv/dealer.html#dmvdeal
Motor vehicle dealers in Florida must obtain a Motor Vehicle Dealer License, also known as a motor dealer bond. This financial assurance protects consumers by ensuring dealers pay for any damages or costs associated with the sale of their vehicles. You must file and register before selling cars if you’re a new or existing motor dealer in Florida. Dealers cannot sell more than five cars in one year without registering and acquiring a dealer license. However, we'll discuss several exceptions to these rules later on. If you plan on selling cars as a business rather than personally, read about your options for getting your bond and registering as a motor vehicle dealer.
A motor vehicle dealer bond is a type of financial guarantee that protects consumers in the event of dealer wrongdoing. The dealer bond ensures that if they break the law or violate their contract, they will repay any damages caused to consumers. Dealer bonds are necessary for most states to protect consumers and ensure dealers comply with state laws. There are two main types of dealer bonds: - Motor vehicle dealer bond: This type of dealer bond secures payment for any default or breach of contract by a dealer. It also guarantees the prompt payment of sales or excise taxes on motor vehicle sales. - Motor vehicle repairer bond: This type of bond secures payment for any damage caused by the repairer during work on motor vehicles.
The amount of your motor vehicle dealer bond will depend on the type of business you operate. For example, new car dealers will need a higher bond than used car dealers. Dealers who sell both new and used cars will need two bonds. The cost of your bond will depend on your required bond amount, your credit history, and financial solvency. The Florida Department of Highway Safety and Motor Vehicles (DHSMV) will determine your bond amount. You can estimate your required bond amount by completing their dealer bond form.
Most insurance companies will offer dealer bonds. You can also get a dealer bond through a surety bond company. The Florida Motor Vehicle Dealer Bond-Independent Dealer Bond is above.
If you’re a new dealer applying for a new Motor Vehicle Dealer Bond, you’ll first need to register with the DHSMV. This can be done online or by completing and mailing the Dealer Bond Application. Existing dealers will need to renew their bonds each year. You can restore your dealer bond online or by completing and sending the Dealer Bond Renewal form. Once you’ve registered and obtained a bond, you’re ready to start selling cars. However, you should be aware of a few exceptions to these rules. New dealers can sell up to five vehicles before registering as a dealer, provided they have an appointment with the DHSMV. Existing dealers can sell up to 10 cars without renewing their bonds.
As you can see, obtaining a dealer bond and registering as a motor vehicle dealer are straightforward tasks. Still, it’s essential to know the regulations and follow them to the letter. If you’re new to the dealer business, it’s a good idea to partner with a broker who can help ease the process. Keep in mind that dealer bonds are financial assurances. This means you'll still have to pay for your bond even if you do everything right and follow the rules.
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