South Carolina Auto Dealer Bond
What is a South Carolina auto dealer bond?
To get your auto dealer license in South Carolina, the Code of Laws requires you to purchase a surety bond. Here are the surety bond requirements for different types of bonds (effective 1/1/2024):
- Retail, wholesale, and RV dealers: $50,000 bond
- Motorcycle and motorcycle wholesale dealers: $25,000 bond
- Wholesale auction dealers: $15,000 bond
A South Carolina 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 South Carolina:
What does a South Carolina auto dealer 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, you might 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 $50,000 South Carolina dealer bonds for as low as $375 a year. Apply today!
Why is this bond required?
The South Carolina Code of Laws requires dealers and wholesalers to post a surety bond before they can receive their license to operate in the state.
- The law defines a “motor vehicle dealer” as anyone who attempts to effect the sale of or sells any motor vehicle.
- A “wholesaler” is anyone who sells or tries to sell any used motor vehicle exclusively to other wholesalers or motor vehicle dealers.
How to Get Your South Carolina Auto Dealer License
Here’s the general process for applying for a license in SC (see details on the DMV website):
- Attend a pre-licensing course.
- Request a pre-inspection of your business location.
- Submit Articles of Authorization.
- Apply for your SCDOR retail license.
- Obtain city- or county-compliant documents.
- Complete the Application for a Dealer or Wholesaler License.
- Obtain a national criminal report.
- Get a Motor Vehicle Dealer and Wholesaler Bond.
- Complete the Application for a Dealer or Wholesaler License.
Frequently Asked Questions
How long does it take to get a South Carolina auto 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 South Carolina?
The South Carolina Department of Motor Vehicles regulates the industry and is the obligee.
How do I renew my surety bond?
Once you’ve purchased your motor vehicle dealer bond, remember to renew it before its expiration date, which will align with your license expiration. If you’re buying your bond from us, 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.
A South Carolina dealer license lasts for three years, and wholesale auction dealer licenses last one year.
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 South Carolina 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.