How much does an auto dealer bond cost in South Carolina?
Auto dealer surety bonds (also called motor vehicle dealer bonds) are mandated by the South Carolina Department of Motor Vehicles (DMV) as part of the licensing requirements for dealerships to conduct business in the state. The DMV sets the total bond amount based on the type of dealership:
- $30,000 bonds for motor vehicle dealers
- $15,000 bonds for wholesale auto auction, travel trailer, and motorcycle dealers or wholesalers
The surety company determines your premium rate, which is the percentage of the total bond amount you pay as the premium. Premium rates for South Carolina 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 South Carolina 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 South Carolina.
- EZ Surety has issued used car dealer bonds for premiums as low as $300.
- EZ Surety has issued motor vehicle wholesaler surety bonds for premiums as low as $150.
Why are auto dealer bonds important in South Carolina?
South Carolina auto dealer bonds provide protection for customers, creditors, and the state government. When a South Carolina motor vehicle dealer posts a surety bond, they provide a guarantee to the South Carolina DMV that they will conduct business in compliance with the conditions listed in Title 56 of the South Carolina Code of Laws.
If the auto dealer fails to comply with the statutes, 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.
How to get your auto dealer license in South Carolina
To obtain your auto dealer license in South Carolina, you must meet the South Carolina DMV licensing requirements by completing the following steps:
- Complete the application for a dealer or wholesaler license (form DLA-1)
- Pay the $50 first-time application license fee
- Provide a diagram of your business location including the building and display area
- Provide proof of garage liability insurance
- Post the appropriate surety bond
- Provide criminal history report for each owner