What is a Wisconsin Sales Finance Company Bond?

Wisconsin Sales Finance Company BondThe State of Wisconsin requires sales finance companies who are applying or renewing their license to procure a surety bond.

The Sales Finance Company Bond guarantees that sales finance companies comply with all the provisions, rules, and regulations of the state. The bond also ensures financial compensation to harmed parties resulting from deceptive and fraudulent actions by the sales finance company.

According to Wis. Stats. S. 218.0101(34)(a), a sales finance company refers to “any person, firm or corporation engaging in the business of acquiring by purchase or by loan retail installment contracts or consumer leases from retail sellers or lessors in this state.”

Sales finance companies include motor vehicle dealers who sell or lease a motor vehicle on installment contracts/consumer leases, credit agreements or obtain retail installment contracts in their retail sales or lease of motor vehicles.


What are the bond conditions?

  • The bond must be issued by a Surety authorized to do business in Wisconsin.
  • The Obligee is the Department of Financial Institutions.
  • If the Principal (sales finance company) adhered to all rules and regulations during the term of the bond, then the obligation will be void; otherwise, it will remain in full force and effect.
  • The bond is continuously effective until canceled by the Surety by giving 60 days written notice to the Department.
  • The amount of the bond may be reduced only if the Surety sends a written notice of the decrease to the Department at least 30 days before the effective date of the bond amount decrease.
  • If the Principal commits a violation and a claim has been filed against the bond, the Surety will pay the Department up to the penal sum of the bond.
  • The Principal will reimburse the Surety of the amount that has been paid out.
  • If the bond is terminated and not immediately replaced with another bond, the Principal’s license will be revoked.


What is the bond amount?

The bond amount is not less than$25,000. It will be made payable to the State of Wisconsin for the state’s use and of any person who has sustained financial losses due to a sales finance company’s violation of the bond obligations.

The cost of the bond is a percentage of the bond amount, which can range from 1%-5% (bond premium). The cost will vary depending on your credit score and other financial credentials where a surety underwriter will do an in-depth review.

To determine your bond costs, get your FREE quote HERE!


How can I obtain a Sales Finance Company Bond?

To get bonded, here are simple steps to follow:

STEP 1: Apply for the bond

You need to submit a bond application to us. If you’re ready to apply now, you may do so HERE!

STEP 2: Underwriting

We will ask you for a couple of relevant information needed for the bond. This will include your financial history, business performance history, and your credit score. An underwriter will carefully evaluate all those.

STEP 3: Bond execution

Once the underwriter is done with the underwriting process, we will immediately issue the bond and send it to you!

Call us at 800-333-7800 today!

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