California auto dealer bond does not protect the used car dealer from lawsuits, but it protects the consumer from fraud or misrepresentation by the car dealer. Auto Dealer Bond guarantee compliance with state laws and every state sets its own bond amount, period and expiration date.
All auto dealers in California are licensed through the California Department of Motor Vehicles. There are two different applications for new dealers and all other types of dealers, but application packages and checklists for both are readily available. A background check will be run for every applicant.
To Obtain a California Auto Dealer Bond
The bond cost start from $500/yearand up depending on your personal credit history.
obtain a free bond quote for your auto dealer license.
All California auto dealers must purchase a $50,000 surety bond to get licensed.
Include an office with direct entry from the outside, fitted with a desk, filing cabinet and telephone, holding all records related to your business
Display a sign at a minimum of 2 square feet that meets all CVC guidelines and the CA Code of Regulations
Meet the minimum display area size requirements outlined in the CVC auto dealer handbook
Note: Make sure to read through the full requirements to learn which location requirements apply to your business.
Once you have a business location, you should take photographs of the location, which you will need to send in with your application. Based on the type of license you are applying for, different photographs will be required.
You are required to arrange an appointment with an Occupational Licensing inspector. The inspector will inspect your place of business, including the office, the books and records, the display area and the signs. For further details on the exact procedure, visit the DMV’s website.
Bond Amount Required:
$50,000 for Dealers (form OL 25)
$10,000 for Motorcycle Dealers, Motorcycle Lessor-Retailers, All-Terrain Vehicle Dealers, or Wholesale-Only Dealer (less than 25 vehicles per year) (form OL 25B)