Auto Dealer Surety Bonds (Top 3 Questions)

Auto Dealer Surety Bonds

Auto Dealer Surety Bonds – Top 3 Questions ever received!

Over the past 20 years, we’ve heard thousands of questions and in this post we took the time to itemize out the most common out of the bunch.

We know that this process can be overwhelming so please know that we are here to help!

  1. How exactly does an Auto Dealer Bond protect my dealership?
    • The protection that a surety bond provides is not going to benefit the auto dealer.
    • It’s meant to cover the general public, other car dealers, and the lenders that provide financing for inventory.
  2. One of my dealer friends told me that the surety company that writes my dealer bond isn’t important. And so for this reason, the bottom-line auto dealer bond price is the only thing that matters?
    • This is a common misconception because a dealer bond is different that dealer insurance.
    • You don’t want your bond carrier to pay claims without proper investigation. Why? YOU reimburse every bond claim so once they pay the claim, you are now responsible for payback.
  3. How should I budget for my Auto Dealer Bond cost?
    • The rate is typically between 1% and 9%, depending on your Experian Credit Score. 
    • The 2 other main factors are citizenship status and property ownership.
Auto Dealer Surety Bonds for less!


Most of these questions come from wholesalers, auto brokers, and retail dealers. But even with that said, seasoned dealers usually have a general idea of how this works. For that reason, we released this content in hopes of helping at least a few of you out there.

What is the difference between Dealer Insurance and Auto Dealer Surety Bonds?

How can I obtain more free info? I am just getting my California Car Dealer License in 2018?

YCDB developed the only podcast that is geared to the success of the used auto dealer industry. Have a listen to the Your Car Dealer Podcast and let us know your thoughts.

Your Car Dealer Bond Headquarters

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