Nevada Auto Dealer Bond
What is a Nevada auto dealer bond?
The Nevada Department of Motor Vehicles requires new and used vehicle dealers to be licensed and bonded. Dealers must obtain a $100,000 bond as part of the licensing process. The official name for this bond is “Vehicle Industry Business License Bond.”
An auto dealer bond holds dealers and dealerships accountable to the law and industry regulations. If a dealer causes a customer financial harm by breaking the law, the customer can file a claim against the bond for compensation.
Get Your Auto Dealer Bond in Nevada:
How do these bonds work?
Nevada auto dealer bonds involve three parties:
- Obligee: The Nevada DMV
- Principal: The auto dealer that must purchase the bond
- Surety: The corporation that issues the bond
The principal must follow the terms of the bond contract, state and federal laws, and industry regulations. If they break the law, they could face bond claims of up to $100,000.
What does a Nevada auto dealer surety bond cost?
Auto dealer bond premiums can vary based on applicants’ credit scores: the higher your credit score, the lower your annual premium. If you have excellent credit, expect to pay as little as 1% or less of the total bond amount. Other factors that may impact the cost of your bond include your industry experience and business and personal financials.
ZipBonds can offer $100,000 motor vehicle dealer bonds for as low as 1% of the bond amount ($1,000). Apply today!
Why are these bonds required in Nevada?
The Nevada Revised Statutes require auto dealers to post bonds and abide by their terms while operating their businesses. If they break the law by committing fraud or another violation, they could face costly bond claims and lose their license.
Surety bonds hold bondholders accountable to the law. If the bondholder (in this case, the auto dealer) breaks the law, they could face bond claims up to $100,000.
Who needs an auto dealer bond in Nevada?
To apply for the following license types, you will need a $100,000 surety bond:
- Used auto dealers
- New auto dealers
- Rebuilders
- Manufacturers
- Distributors
- Peer to peer car sharing programs
To apply for a license to deal in utility or boat trailers with an unladen weight of 3,500 or less, you’ll need a $10,000 surety bond. Dealers for motorcycle, horse trailers without living quarters, and utility trailers with an unladen weight of 3,501 or more need a $50,000 bond.
How to Get Your Nevada Auto Dealer License
Here’s an overview of what you’ll need to provide the DMV to get your license and operate your business legally in Nevada.
- Application for Business License
- Personal History Questionnaire
- A set of fingerprints (of each principal)
- DPS Fingerprint Background Waiver
- Surety bond
- Insurance certificate of liability coverage
- Copy of business license
- FEIN
- Email address
- Established place of business
- Permanently affixed display sign
- Two color photographs of the business location
- Site inspection
The application fee is $125 for new licenses and $50 for renewals. See detailed instructions on how to apply and find all your forms in the Business License Application Packet.
Frequently Asked Questions
How long does it take to get a Nevada motor vehicle dealer bond?
Since this bond requires underwriting, we can’t issue it to you instantly. However, the ZipBonds team always strives to deliver your bond to you within 24 hours of application.
Who regulates auto dealer bonds in Nevada?
The Nevada DMV regulates licensing and bonding for the motor vehicle industry.
How do I renew my surety bond?
You must renew your bond each year by a specific date for it to remain active (and for you to maintain your business license). If you’re buying your bond from Zip, we’ll send a reminder when the expiration date is approaching. That way, you’ll have plenty of time to renew your bond and maintain your business license.
What happens if someone files a claim on my bond?
A customer can file a claim if a dealer commits fraud or unethical or unlawful business activity. If the claim is valid, the surety may cover the customer’s losses up to the total amount of the bond. The dealer will then need to pay back the surety for the damages.
Claims can be costly and damage your reputation and ability to get licensed and bonded again, so it’s best to do everything you can to avoid them.
How can I avoid claims on my auto dealer bond?
Avoid illegal activities and fraudulent business practices to prevent claims on your bond. Pay all taxes you owe. Also, ensure you comply with your licensing regulations. If a customer complains about something, address the issue immediately to avoid complaints from turning into costly claims.
How to Get Your Nevada Auto Dealer Bond
ZipBonds offers the fastest and most secure option for getting the surety bonds you need. Our all-digital platform is intuitive and straightforward. Apply online or call us at (888) 435-4191 to get bonded in a flash!
About ZipBonds.com
Founders Ryan Swalve and Zach Mefferd formed the vision for ZipBonds.com when they realized how overly complicated it was to help clients place surety. The frustration of being unable to incorporate the technology they’d used in other insurance-focused projects left them thinking “there has to be a better way.”
Fast forward a couple of years, and that better way is the impetus of everything we do at ZipBonds. We constantly look for innovative ways to improve the bonding process for our clients and agents. Our team comprises individuals who understand all angles of surety – for companies, agencies, and individuals. Incorporating everyone’s point of view to improve the process while simultaneously integrating cutting-edge technology is what sets our business apart.