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Auto dealer surety bonds (also called motor vehicle dealer bonds) are mandated by the New Mexico Motor Vehicle Division (MVD) as part of the licensing requirements for dealerships to conduct business in the state. The MVD sets the total bond amount based on the type of dealer license:
The surety company determines your premium rate, which is the percentage of the total bond amount you pay as the premium. Premium rates for New Mexico auto dealer bonds typically cost between 1% and 3% of the total bond amount.
During the application process, the surety company evaluates your personal credit, financial statements, industry experience, and licensing history. Applicants with good credit generally receive the lowest rates, however, bad credit will not prevent you from securing a New Mexico auto dealer bond. EZSurety still offers competitive rates to individuals with low credit scores or other financial issues.
Below are the lowest premiums EZ Surety has issued for auto dealer surety bonds in the State of New Mexico.
New Mexico auto dealer bonds provide protection for customers, creditors, and the state government. When a New Mexico motor vehicle dealer posts a surety bond, they provide a guarantee to the bond's Obligee (the MVD) that they will conduct business in compliance with the conditions listed in Section 66 - 4 - 7, NMSA 1978 Comp.
If the auto dealer fails to comply with the conditions, the surety company will pay out financial losses to damaged parties up to the full bond amount. The auto dealer is liable to reimburse the surety for any damages paid under the bond.
To obtain your auto dealer license in New Mexico, you must meet the New Mexico Motor Vehicle Division licensing requirements by completing the following steps:
New Mexico motor vehicle dealer bonds and auto dealer licenses both expire annually on March 31st.