Virginia Auto Dealer Bond

Both new and used vehicles dealers in Virginia need to get licensed in order to proceed with conducting their businesses. Getting bonded is an essential part of the licensing process and dealers need to post a bond in the amount of $50,000.

In the Commonwealth of Virginia the agency overseeing new and used vehicle dealer licensing is the Motor Vehicle Dealer Board, while the DMV is taking care of the motorcycle, trailer and recreational vehicles. That means that in the bonding process the Motor Vehicle Dealer Board is the obligee that the bond will be protecting.

Obligee Information:

Virginia Motor Vehicle Dealer Board
2201 W. Broad Street, Suite 104
Richmond, VA 23220

Dealers are required by the Virginia Department of Motor Vehicles to post a $50,000 surety bond as part of their licensing procedure. The annual premium you will be paying, however, is just a fraction of the whole bond amount, usually a percentage varying between 1% and 3%.

Keep in mind that auto dealer bonds are subject of underwriting, which means that the final bonds cost will be formed based on your financial background. The major factor taken into account is your personal credit score.

The following table can give you an example of how the auto dealer bond premium varies according to your credit score.

There are still options for good bonding deals left for you, even if you have a bad credit. Lance Surety Bonds has its own bad credit program designed to help applicants with bad or even no credit score get the best deal possible.

Keep in mind that bad credit is a higher risk factor for bonding companies. This means the premiums will be slightly increased, between 5% and 10% to be precise. That will serve as a safety measurement against the higher risk. Lance Surety Bonds, however, works only with A-rated, T-listed bonding companies which ensure you get top rates for your score.

Auto dealer bonds are underwritten by surety bond companies, based on an evaluation of your business and financial background, with credit score playing the most important role in the quoting process.

You can get your free quote by accessing our online application and submitting your request. Our team will get back to you within minutes with your personal bond quote. For further questions, feel free to reach out at (877) 514-5146. Our experts will assist you with anything you need to know about the Virginia auto dealer bond.

If you want to get acquainted with the bonding process in details, check our “How to Get Bonded” page for more information on the process of obtaining an auto dealer bond.

The Virginia auto dealer bond will not expire automatically when the dealer’s license does. It will continue indefinitely from license term to license term.

If dealers fail to comply with Virginia state laws and regulations regarding their business operations, a claim might be filed against them. The surety company will cover the compensation initially but the dealer will have to repay the reimbursement eventually.

It’s always better to reach a settlement before going to court. If the claim is valid this will not only cost you money but can also affect your reputation and increase your premium in the future. That’s why it’s best that you do avoid claims at all costs.