Virginia Auto Dealer Bond
What is a Virginia auto dealer bond?
The Virginia Motor Vehicle Board requires anyone applying for a motor vehicle dealer license in the state to post a $50,000 Motor Vehicle Dealer Bond. This includes dealers wishing to sell cars, trucks, motorcycles, RVs, and trailers.
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 Virginia:
How much does a Virginia 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, 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 $50,000 Virginia auto dealer bonds for as low as $500. Apply today!
Who needs an auto dealer surety bond in Virginia?
If you’re a motor vehicle dealer or applying to become licensed as one, you’ll need to post a bond. Anyone who sells at least five cars in a 12-month period is considered a motor vehicle dealer in Virginia. See the Code of Virginia for specific requirements.
How to Apply for Your Auto Dealer License in Virginia
Follow this general process to become an auto dealer or form a dealership in Virginia:
- Choose whether you will be an independent dealer or a franchise dealer.
- Register as an LLC or Corporation.
- Make sure your location satisfies all zoning regulations.
- Get your $50,000 auto dealer bond and liability insurance.
- Submit all required forms to the MVDB.
- Pay the necessary fees.
- Schedule an appointment for a Field Representative to visit your location.
See the MVDB Checklist for specific information on each step of the licensing process.
Frequently Asked Questions
How long does it take to get a 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 Virginia?
The Motor Vehicle Dealer Board (MVDB) regulates licensing and bonding for the motor vehicle industry in Virginia.
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 Virginia 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.