It’s possible to get a new and used car dealer surety bond with bad credit, but not all bonding companies will be able to approve you. Why? Because your personal credit is the main item that is considered when you apply for your auto dealer bond; it’s used to get an idea of your likelihood of triggering bond claims and your ability to pay them.
What happens if there is a claim on my bond?
A claim can be made on your dealer bond if you don’t follow all applicable laws and regulations of your state. If a legitimate claim is filed against your dealership, the surety company will pay all relevant costs up to the amount of the required surety bond. However, the auto dealer will have to reimburse these costs to the surety later, which means avoiding claims is the best course of action.
How Much Does it Cost for a Dealer Bond with bad Credit?
The cost of a car dealer bond will vary depending on several factors including, but not limited to: the personal credit score of the owners, prior surety bond claims, and related experience. Owners of a motor vehicle dealership with excellent credit can expect to pay an estimated rate of 1% of the surety bond amount needed. Individuals seeking a bad credit motor vehicle dealer bond can expect to pay anywhere between 2% to 10% of the bond amount. In rare instances where serious credit issues are indicated on the personal credit report, applicants may be required to pay more. Additionally, these bonds can be financed so the dealer can afford to pay monthly payments for the surety bond.
How Do I Apply for a Car Dealer Bond?
First, click anywhere you see “Apply Now”. This will take you to our online surety bond application. Second, insert the basic information about your car dealership and its owners. Third, submit your application and receive your surety bond quote the same business day.
For more information or questions contact www.allstatesuretybonds.com