Utah Auto Dealer Bond
What is a Utah auto dealer bond?
To get your auto dealer state license in Utah, you must purchase a $75,000 auto dealer bond. This includes anyone with a business that sells new or used motor vehicles or off-highway vehicles and sells, displays for sale, or offers or exchanges three or more vehicles in 12 months. Body shops must post a $20,000 bond. Crushers, motorcycle dealers, and small trailer dealers must post a $10,000 bond. See the Utah Code for definitions.
A Utah 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 Utah:
What does a Utah 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 Utah $75,000 auto dealer bonds for as low as $375. Apply today!
Who needs auto dealer bonds in Utah?
The Utah Motor Vehicle Enforcement Division (MVED) requires auto industry professionals to post the following bonds to operate legally in the state:
- New and used motor vehicle dealers: $75,000 bond
- Motorcycles and small trailer dealers: $10,000 bond
- Body shops: $20,000 bond
- Crushers: $10,000 bond
Why is this bond required?
Utah Code requires anyone licensed to engage auto dealer or related activities to maintain a surety bond. The bond ensures dealerships faithfully perform their obligations, according to state laws, while engaging in motor vehicle transactions. It also guarantees payment of taxes, license fees, and penalties.
How to Get Your Utah Auto Dealer License
Here’s the general process to obtain your auto dealer license in Utah:
- Complete the application form.
- Fill out an FBI Fingerprint Card and Fingerprint Waiver.
- Include passport-type photos of each owner/partner/member/corporate officer.
- File a surety bond.
- Take a photo of your dealership location that includes the sign.
- Secure a sales tax number.
- Attend an eight-hour training seminar.
- Include a copy of your franchise agreement (if applicable).
- Get your dealer plates.
- Complete additional location requirements.
See instructions from the MVED for step-by-step details.
Frequently Asked Questions
How long does it take to get a Utah 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 Utah?
The Utah Motor Vehicle Enforcement Division regulates the motor vehicle industry in Utah. If you need to contact the Division with questions about your license, call (801) 297-2600.
How do I renew my surety bond?
Once you’ve purchased your motor vehicle dealer bond, remember to renew it every two years before its expiration date. 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.
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 Utah 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.