What is an Alabama Motor Vehicle Dealer Bond?
A quick guide to one of the most important requirements for motor vehicle dealers in Alabama!
An Alabama Motor Vehicle Dealer Bond is an umbrella term for different surety bonds, namely:
- New Motor Vehicle Dealer Bond
- Used Motor Vehicle Dealer Bond
- Motor Vehicle Reconditioner Bond
- Motor Vehicle Rebuilder Bond
- Motor Vehicle Wholesaler Bond
If you fall under any of the categories listed, the Business and License Tax Division of the Alabama Department of Revenue requires you to submit a surety bond along with your license application.
As with most surety bonds, this bond is conditioned to ensure that the licensee will lawfully perform his or her duties, and will financially compensate his or her clients if a violation is committed.
The surety bond requirement is in strict compliance with Section 40-12-398 of the Code of Alabama.
What is the Motor Vehicle Dealer Bond amount?
$25,000 – New Motor Vehicle Dealer
$10,000 – Used Motor Vehicle Dealer, Motor Vehicle Reconditioner, Motor Vehicle Rebuilder, Motor Vehicle Wholesaler
If you have a stellar credit score, you will be eligible to pay for a low bond premium! Bond premium starts at $100.
Know what you need to pay today by getting your FREE SURETY BOND QUOTE HERE!
What are the bond conditions?
- The surety bond should be issued by a surety bond agent or company that is authorized to conduct business in Alabama
- The surety bond should be made payable to the State of Alabama
- The New Motor Vehicle Dealer, Used Motor Vehicle Dealer, Motor Vehicle Reconditioner, Motor Vehicle Rebuilder, Motor Vehicle Wholesaler is obligated to abide by the provisions of Title 40 Chapter 12 of the Code of Alabama, as well as the rules and regulations of the Business and License Tax Division of the Alabama Department of Revenue
- If the New Motor Vehicle Dealer, Used Motor Vehicle Dealer, Motor Vehicle Reconditioner, Motor Vehicle Rebuilder, Motor Vehicle Wholesaler commits a valid violation, the aggrieved party will be eligible to file a claim on the surety bond
- The surety bond will run from October 1 until September 30.
- A continuation certificate should be submitted to the Alabama Commissioner of Revenue at the beginning of each license year (October 1).
- In case of cancellation, a 60-day notice is required
How can I obtain this bond?
You can easily obtain this surety bond by following these simple steps:
STEP 1: Apply
If you are ready to submit your application for this type of bond, you may easily do it HERE!
Don’t worry! We will guide you through the whole process.
STEP 2: Underwriting
Once we have received your application, we will ask you for a couple of important details needed for the underwriting process. This will include your financial history, your job performance history, and your credit score. An expert underwriter will evaluate all those.
STEP 3: Bond Execution
After you have satisfied the underwriter’s checklist, the bond will immediately be issued and sent to you!
Ready to apply? START HERE!