How much does an auto dealer bond cost in Tennessee?
Auto dealer surety bonds (also called motor vehicle dealer bonds) are mandated by the Tennessee Motor Vehicle Commission as part of the licensing requirements for new and used car dealers and wholesalers to conduct business in the state. The Motor Vehicle Commission sets the total bond amount at $50,000.
The surety company determines your premium rate, which is the percentage of the total bond amount you pay as the premium. Premium rates for Tennessee 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 Tennessee 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 Tennessee.
- EZ Surety has issued motor vehicle dealer bonds for premiums as low as $875.
How to get your auto dealer license in Tennessee
To obtain your auto dealer license in Tennessee, you must meet the Tennessee Motor Vehicle Commission licensing requirements by completing the following steps:
- Complete the dealer license application
- Ensure that the established place of business meets all requirements
- Install the proper signage
- Post the $25,000 surety bond
- Provide proof of liability insurance
- Obtain a business tax license
- Provide copies of your financial statements, corporate documentation, and sales tax documents
- Consent to a financial background check disclosure
- Pay all licensing fees
Tennessee motor vehicle dealer bonds are valid for a two-year period and must start on the first day of the month.
Dealer license terms are based on the surety bond terms and will have the same expiration date as the bond.