Iowa Motor Vehicle Dealer Bond

1. Apply for Your Bond

We make it easy to buy an Iowa motor vehicle dealer bond. Take a few minutes to complete our online application to begin the process. Numerous bond programs are available, and we have provided surety bonds to more than 99% of our applicants. 

Rene contacted us recently when she was preparing her dealer license application documents. She applied online for the required Iowa surety bond and got an instant quote. Rene quickly paid the premium online and received the bond via email without delay. Now, she runs a dealership in Davenport.

2. Get a Quote

Our surety bond company always provides quick quotes to applicants. In fact, most of our customers benefit from an immediate quote after submitting the application online. For more complex situations, we’ll provide a quote within 48 hours. 

We work with numerous bond programs. This allows us to provide applicants with competitive bond premiums.

3. Purchase Your Bond

The last step is to pay your dealer bond’s premium. We provide our customers with a convenient online payment option. After we receive the premium payment, we’ll email the bond to you. We can also send you the bond via mail upon request. 

With your new motor vehicle dealer bond in hand, you can finalize your license application. Simply submit your bond to the state with the other required licensing documentation. 

If you have any questions or encounter any difficulties, our surety bonds experts are here to help you – contact us or call us at (877) 514-5146.

Anyone who sells more than six vehicles within a 12-month period must have an Iowa motor vehicle dealer license also known as “Iowa auto dealer license”. In addition, a dealer license is required for auctioning, selling on consignment and brokering vehicles. 

Per Iowa Code, Chapters 321, 322 and 322c, auto dealers must have a $75,000 surety bond. The obligee is the Central Programs Division of the Department of Transportation. The bond form must be signed by the surety bond company agent and all principals.

The motor vehicle dealer bond in Iowa runs continuously, so it remains in effect until it is canceled. To cancel the bond, a written notice must be provided to the Central Programs Division of the Department of Transportation no later than the cancellation date. 

To avoid a suspension of its auto dealer license, the dealer must provide a new surety bond prior to the existing bond’s expiration date.

While the bond runs continuously, the surety bond company will collect a premium payment annually. We will notify you prior to the payment due date. 

The claimant will file the claim directly with the surety bond company. The surety company then conducts a thorough investigation of the claim to determine its validity. If the claim is not validated, the surety company denies the claim.

If the claim is deemed to be valid, the surety bond company pays the claimant up to the bond’s penal sum. After the claimant is paid, the Iowa dealership is responsible for reimbursing the surety bond company in full.

The Vehicle Central Programs of the Iowa Department of Transportation is responsible for processing dealer license applications. To apply for an Iowa auto dealer license, you must provide: 

• Your dealer license application
• A $75,000 surety bond
• A zoning letter
• Franchise documents
• Completion of an onsite inspection by the Bureau of Investigation & Identity Protection
• Completion of an 8-hour Auto Dealer Pre-Licensing Class, for used auto dealers
• Business entity documentation
• Liability insurance ($100,000 for bodily injury to one person, $300,000 for bodily injury per accident and $50,000 for property damage)
• Fees

Mail the motor vehicle dealer licensing documents to:

Vehicle Central Programs – Iowa Department of Transportation
P.O. Box 9278
Des Moines, Iowa 50306-9278