What Is an Oklahoma Wholesale Dealer Bond?
Wholesale dealers in Oklahoma have to undergo a licensing process before being allowed to operate legally in the state. As a part of the requirements, you need to obtain a wholesale dealer bond.
This is a kind of auto dealer bond whose goal is to protect the state and your customers. It ensures your legal compliance and can provide a reimbursement to parties who suffer damages due to potential unlawful actions you may engage in.
As all surety bonds, your wholesale dealer bond is a contract between your company as the principal, and two more entities. The Oklahoma Used Motor Vehicle and Parts Commission is the obligee requiring the bond, and the surety is the bond provider.
Questions about Wholesale Dealer Bonds in Oklahoma
When is this bond required?
In order to start a wholesale dealership in Oklahoma, you need to get licensed with the state Used Motor Vehicle and Parts Commission. This requires posting a $25,000 surety bond. Its purpose is to ensure you will follow applicable state statutes and the Oklahoma Motor Vehicle Commission Laws.
How much does the bond cost?
Obtaining an Oklahoma wholesale dealer license entails posting a $25,000 surety bond. This is the required bond amount. You have to cover a fraction of it, called the bond premium, in order to get bonded.
The formulation of your surety bond cost is based on a detailed examination of your personal credit score and other financial factors. The surety needs to take a close look at your company finances, and assets and cash on hand you may be able to demonstrate. This is how the level of bonding risk is determined. The lower it is, the smaller your bond premium is likely to get. You can expect rates between 1% and 5% if your overall profile is stable.
|Surety bond name||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Oklahoma wholesale dealer bond||$25,000||$187.5-$375||$250-$750||$625-$1,250||$1,250-$2,500|
Is it possible to obtain this bond with bad credit?
Yes, you can obtain an Oklahoma wholesale dealer bond even if you have problematic finances. We have designed our Bad Credit Surety Bonds program for applicants with issues such as a low credit score.
The typical bad credit rates range between 5% to 10%, as a way to mitigate the increased bonding risk. Still, as we cooperate with numerous A-rated, T-listed surety companies, we are able to find a top matching bonding option for your particular case.
How do I obtain the bonding?
If you need more information about the way surety bonds work, you can find extensive details on our How to Get Bonded page.
You can call us at (877) 514-5146 if you have further questions or would like to get assistance with your bond application.
How are bond claims handled for wholesale dealers?
Just like the rest of surety bonds, your wholesale dealer bond is not insurance for your company. Instead, it is a safety mechanism designed to safeguard the interests of the state and of your customers. The bond amount of up to $25,000 can be used to reimburse parties which you have harmed with potentially unlawful activities.
When a bond claim is filed against you, your surety needs to examine the details. If the case is proven, you are liable to cover the damages. While your bond provider may pay them at first, according to the bond indemnity agreement you need to repay it in full. As claims can be costly and damaging to your business, the wisest idea is to stay away from situations that can give rise to them.
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