The Tennessee Motor Vehicle Dealer Bond is a surety bond required for individuals who want to operate auto dealerships within the state. This bond is a licensing requirement established by the Tennessee Motor Vehicle Commission.
The Tennessee Motor Vehicle Dealer Bond functions like other surety bonds in that it is an agreement between the obligee, the principal, and the surety. The obligee—in this case, the Tennessee Motor Vehicle Commission—is the entity that requires the bond, while the principal refers to the business or the individual that must obtain the bond.
The surety is responsible for ensuring that the principal will adhere to their licensing laws and abide by all state regulations. In the event that an injured party files a claim against the principal’s bond, the surety will compensate the claimant up to the bond amount if the claim is valid. Business practices that can result in claims may include fraud involving financing, odometer tampering, or failure to pay for purchased warranties.
It’s important to note that the principal is financially responsible for reimbursing the surety for any claims paid out, plus additional fees and expenses incurred.
Motor vehicle dealers applying for a TN motor vehicle dealer license are required to obtain the Motor Vehicle Dealer Bond. A motor vehicle dealer includes the buying, selling, leasing, repairing, or renting of five or more vehicles within a year.
The Tennessee Auto Dealer Bond has a two-year term and is issued in conjunction with your motor vehicle dealer license upon renewal.
Tennessee motor vehicle dealers must obtain a bond amount of $50,000. Fortunately, only a smaller percentage of the total bond amount, called a premium, is required for you to obtain your bond. Your premium rate is determined by your credit score, industry experience, and financial standing.
With optimal credit and financials, premium rates may start as low as 1% of the bond amount. Even if you have nonstandard credit, we still encourage you to apply for your bond. The application and bond quote is free, and at EZ Surety Bonds, we work with a variety of sureties to find you the best quote available.
The obligee is the entity that requires the TN Auto Dealer Bond. In this case, the obligee is the Tennessee Motor Vehicle Commission, which operates as a division of the Tennessee Department of Commerce and Insurance. Their contact information is as follows:
Tennessee Motor Vehicle Commission
500 James Robertson Parkway
Nashville, Tennessee 37243
Phone: 615-741-2241
Email: mvcmail@tn.gov
With EZ Surety Bonds, bond applications are quick, easy, and free. You can secure your Tennessee Motor Vehicle Dealer Bond by filling out our quick online form, and one of our friendly surety experts will contact you regarding your free quote within 24 hours. Following the payment and receipt of your bond, you can file it with your obligee, the Tennessee Motor Vehicle Commission.
Our surety experts are always happy to assist. If you have any questions, please contact bonds@southcoastsurety.com or call 1-800-361-1720.
Here are the steps to get your Tennessee motor vehicle dealer license:
Upon acceptance by the Tennessee Motor Vehicle Commission, an on-site inspection will be conducted before your license is issued. You may receive your license within 14 days of receiving approval.
For more information on obtaining a car dealer license, check our detailed guide here.
Motor vehicle dealers in the state of Tennessee are required to secure a $50,000 bond. Fortunately, your premium rate is based on several factors, such as credit score, industry experience, and financial standing. We offer competitive quotes and work with a variety of sureties, including non-standard markets, to find you the best quote regardless of your credit rating. Simply apply on our website today, and we’ll contact you regarding your free quote within 24 hours.
After you purchase the bond, we will mail the original document to you. Most obligees require you to file the original bond with them (usually signed by the principal), although some obligees may approve of an electronic copy. Every obligee has its own unique filing requirements, so be sure to confirm your obligee's filing requirements before doing anything with your bond.
You’ll know if you need a surety bond because some entity will have required you to obtain one. They must also inform you of which specific bond type you’ll need. There are thousands of bonds across the country, all of which vary by state and industry.
Visit EZSuretyBonds.com to browse hundreds of bonds by state, type, or industry.
