If you are planning to open a business selling pre-owned or a used car, then you should learn and understand the importance of a used car dealer bond. Generally, it is a type of insurance that car dealers must obtain before they can operate a business focused on selling pre-owned cars for them to get an insurance protection against fraudulent and shady customers that might take advantage out of your business for their own good.

car dealers

Used car dealer security bond provides financial security in case of emergency and if they figured in an incident that includes fraudulent cases against their customers. Most dealers of used cars in Montclair. This will also be beneficial to the customer in case there are discrepancies with the dealer’s transaction where the insurance company that covered the latter will reimburse the amount of money involved.

For you to avail of a used car dealer bond, you should primarily submit a set of requirements for submitting yourself for a credit check to determine your financial capabilities. Insurance companies will run you through different screening processes as part of their terms and conditions before you can avail of this type of insurance.

In fact, the majority of the pre-owned car dealers in the United States are required to file a surety bond with the Department of Motor Vehicles (DMV) as part of the process of providing the dealers a license to open a pre-owned and used car dealership business in their respective areas.

In most cases, a lot of auto dealers in the United States were left confused and misguided because of its intricate and very complex application that needs a lot of requirements if you are planning to apply that is why in this short article, I will show you the needed requirements so that you can breeze through during the application process.

First, you should compile and complete all the requirements that are needed for the process of application to get avail of the surety bond. These requirements include the Occupational Licenses (OL) forms that must be printed individually.

So here are the requirements:

  • Application for OL Part A, C
  • OL for Surety Bond of Dealer
  • Deposit Agreement and Assignment
  • Payee Data Record
  • Authorization to Release Financial Information
  • OL for Personal History Questionnaire
  • Appointment of Director as Agent for Services of Process

Additional requirements are:

  • Dealer Education Program
  • DMV dealers’ examination
  • LOA for dealers of trailers
  • Statement of Information SI 550 and LLC 12
  • A copy of your Fictitious Name Statement
  • Lease or rental agreement or property ownership of the business
  • City/County business license
  • Occupancy License
  • Tax Certificate
  • Board of Equalization Resale permit
  • Pictures of the business site

For more information about the procedures and the other requirements that are needed for surety bond application, you can visit the DMV website.