What Is a Oklahoma Auto Dealer Bond?
Oklahoma car dealers must submit an auto dealer bond to the Oklahoma Used Motor Vehicle and Parts Commission when applying for their Oklahoma dealer license. This requirement applies to all used and wholesale dealers, but not to new car dealers.
The bond protects your customers, and the state of Oklahoma, in case of of bad business practices, fraud and dishonesty, or non-compliance with state regulations for auto dealers, such as the Oklahoma Used Motor Vehicle Dealer Laws.
The Oklahoma motor vehicle dealer bond is a binding agreement, between the auto dealer as the principal, the Oklahoma Used Motor Vehicle and Parts Commission and the public as the obligees and the surety company that underwrites the bond.
Obligees can file a claim if they are harmed by an auto dealer’s dishonest actions, and receive compensations by the surety company. Check the sections below for answers to all of the most important questions related to Oklahoma auto dealer bonds.
Frequently Asked Questions
- Do all Oklahoma car dealers need to get a bond?
- How much does a Oklahoma auto dealer bond cost?
- Can I get an Oklahoma auto dealer bond with bad credit?
- How do I get my Oklahoma auto dealer bond?
- How do I renew my Oklahoma auto dealer bond?
- How do I get my Oklahoma auto dealer license?
- How are bond claims handled for auto dealer bonds?
Do all Oklahoma car dealers need to get a bond?
Unlike in most other states, not all car dealers in Oklahoma need to get bonded. The surety bond requirement applies only to used car dealers and wholesale car dealers. They must post a $25,000 Oklahoma auto dealer bond when applying for a license at the Oklahoma Used Motor Vehicle and Parts Commission.
How much does a Oklahoma auto dealer bond cost?
The cost of obtaining your bond is a percentage of the full amount of your $25,000 bond. The cost, or bond premium, is determined by sureties when you apply for your bond.
How much you will have to pay depends on what kind of rate you are offered. Standard rates are those that are between 1% and 3% of the total amount. As you can see in the table below, this means that to get your bond you may have to pay something between $250-$750 at a standard market rate.
|Surety Bond Cost by Credit Score|
|Surety Bond Name||Surety Bond Amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Oklahoma Used and Wholesale Motor Vehicle Dealer Bond||$25,000||$188-$375||$250-$750||$625-$1,250||$1,250-$2,500|
Whether you have to pay $250, $400, or a different rate, is determined by the surety company when you apply and it reviews your application. The rate it sets is strongly influenced by your personal credit score, and a number of other factors such as your financial statements, your liquidity and assets but also your industry experience and expertise. And the higher your score is, the lower your bond premium will be.
Visit our surety bond cost page for more information.
Can I get an Oklahoma auto dealer bond with bad credit?
Getting an Oklahoma auto dealer surety bond with less-than-stellar credit– or with no credit at all– is still possible with Lance Surety Bonds.
Thanks to our Bad Credit Program you can get your auto dealer bond, despite credit difficulties, at a cost that ranges between 5% and 10%. These rates are higher than standard market rates, to mitigate the risks involved in bonding applicants with lower credit scores.
Yet, by getting a bond and opening a dealership, you can improve your credit score and other financial indicators, and receive a better rate over time.
Furthermore, we pride ourselves in working with only the best and most professional A-rated and T-listed surety companies. This means we can offer rates that are tailored to each applicant’s financial status and situation.
How do I get my Oklahoma auto dealer bond?
Apply online here and submit your application for a fast and free, no-obligations quote.
To speak to one of Lance Surety Bonds’ professionals, call us at (877) 514-5146. We can provide you with more information about Oklahoma motor vehicle dealer bonds, and what you need to do to get bonded.
Questions? Look at our how to get bonded page for more information about the process of getting bonded.
How do I renew my Oklahoma auto dealer bond?
Renewing your Oklahoma auto dealer bond always goes hand in hand with renewing your Oklahoma auto dealer license. All licenses and bonds expire on December 31 of each odd numbered year, meaning licenses are issued for two years at a time.
Failing to renew your bond may complicate matters with renewing your license. But there’s no need to worry about missing your renewal deadline. Lance Surety Bonds always sends a renewal reminder at least two months before the bond’s expiration, so that you can take care of this in due time.
When you renew your bond, you will receive a new bond quote from the surety company, which will be based on your current credit score and financial status. If, in the two years since you’ve gotten bonded, you’ve improved your score, you can expect to receive a lower quote.
How do I get my Oklahoma auto dealer license?
Oklahoma car dealer licenses for used and wholesale car dealers are obtained through the Oklahoma Used Motor Vehicle and Parts Commission. The commission’s website offers an extensive list of everything you need in order to be eligible to receive your license.
Among other things, you will be asked to submit a number of documents such as a personal history questionnaire, a copy of your driver’s license, financial statements, photos of the business location, and a letter of permit. You will also be asked to have obtained a $25,000 Single Limit Garage Liability Insurance, along with your $25,000 Oklahoma motor vehicle dealer bond.
Finally, you will also be asked to pay either a $200 or a $600 application fee, for used motor vehicle dealers and wholesale motor vehicle dealers respectively.
How are bond claims handled for auto dealer bonds?
When a bond claim is made against your dealer bond, this may signal a lot of trouble for your dealerships, your reputation, and your financial stability.
As bonds offer protection to customers, claims can be filed against these bonds whenever a dealer does not comply with state regulations, such as the Oklahoma Used Motor Vehicle Dealer Laws. If the claim is legitimate, your surety company must compensate the claimants for the financial harm they have suffered, up to the full bond amount.
Because bonds work like a line of credit, whenever a claim is made against a bond and compensation is paid by the surety, the bond principal (the auto dealer in this case) must repay the surety for its coverage. Therefore, auto dealers should always strive to avoid claims against their bonds.