New Jersey Motor Vehicle Dealer and Leasing Company Bonds

Get Your New Jersey Motor Vehicle Dealer Bond

Who Is Required To Purchase an Auto Dealer Bond In New Jersey?

There are a number of vehicle license classifications in New Jersey. Here are the classifications required to purchase an auto dealer surety bond:

• New and used vehicle dealers
• Used only vehicle dealers
• Vehicle leasing dealerships

The other classifications are not required to purchase a vehicle dealer surety bond:

• Boat dealers
• Auto body repair shops
• Emission repair facilities

While not a dealer, New Jersey driving schools are managed by the Motor Vehicle Commission and required to purchase a surety bond (driving school surety bond) too.

The New Jersey Auto Dealer Bond Amounts

New Jersey has relatively low bond amounts compared to most states' dealer requirements.

These bond amounts are total amount of financial protection afforded to your customers and the New Jersey Treasury in the event of purposeful dealership fraud. Examples are covered in detail in the next section.

Here are the bond amounts set by the Commission:

Keep in mind, these are licenses and bond requirements are independent.

For example, if you have a new and used dealer license and you decide to lease vehicles, this would require a bond specific to that license.

Why is a New Jersey Motor Vehicle Dealer Bond Required?

The New Jersey Motor Vehicle Commission is responsible for approving and licensing businesses that wish to operate vehicle dealerships in the state.

In order to legally sell vehicles, you must be licensed. And even though a dealership is licensed, it does not mean they will conduct business according to the law.

Every year the Commission receives complaints about dealerships that have financially harmed customers or they'll be notified of dealerships that have failed to pay the correct tax liability.

Examples of fraudulent actions (besides tax avoidance) include:

• Improperly transferring a title
• Selling vehicles with no title
• Misrepresenting vehicle information like mileage, manufacture year, or condition
• Stealing customer deposits
• Selling vehicles and not reporting them to avoid licensing requirements

Once a dealership is licensed, the state can't police them. So to help hold every dealership accountable to their customers and state laws, the require the surety bond.

If a customer is financially harmed by a dealership on purpose, the customer can make a claim against the dealership and their surety bond. If the claim is valid it will pay the customer back the damages they've suffered.

This also applies to the Treasury. They can collect on the surety bond for sales taxes due to them.

What makes a surety bond unique is the total amount of compensation available is capped by the bond amount ($10,000 for all licenses).

How Much Does a $10,000 New Jersey Auto Dealer Bond Cost?

The good news in New Jersey is with the smaller bond amounts, the prices will not be significant. Plus, New Jersey is one of the few states where not every surety bond is credit based.

Typically the price of an auto dealer bond will be based on these three primary factors:

• Personal credit or owner and owners
• Dealer industry and experience
• Prior surety bond history if any owner has been bonded in the past

Based on these factors, the surety (insurance company) that underwrites the bond will quote a rate.

We are Surety Bonds Direct, a specialized surety agency, and we work with the highest A-rated sureties to find you the lowest possible price.

New and Used and Used Only Auto Dealer Bonds

Because of the low bond amount and the minimal amount of fraud, we have secured the lowest price possible of $100.

This means you can purchase your bond immediately and have it delivered to you in less than one business day.

Leasing Dealership Surety Bond

This bond is a credit driven bond and the process is a little longer.

First, we'll have to collect some basic information about your business and run the personal credit of all the owners.

We will then price shop for you with our network of sureties to find you the lowest price.

This process typically takes about one business day to complete.

Once done, we'll contact you with the lowest price we've identified. At this point it's up to you to purchase your bond. There is zero obligation to purchase and at the very least you have pricing that is good for 30 days.

Here is example pricing based on rates that range from really good to average.

Get your pricing today and use it so you know the exact total dollar amount you need to obtain your license.

Click here and complete the quote form to get pricing today. You can call a bond specialist to speak with a real person at 1-800-608-9950.

How Long Does The New Jersey Auto Dealer Bond Last?

Once you're ready to purchase your auto dealer bond, you just need to complete an online checkout form.

After your payment is processed our bond issuance team will prepare your bond with the:

• Correct bond form
• Required signatures and seals
• Power of attorney

This is not an immediate process and will take up to one business day to complete.

Once your bond is ready to be delivered, we will email you a copy. The New Jersey Motor Vehicle Commission accepts a copy of the bond.

If you want a physical copy for your records, we can mail you one.

Renewing Your Auto Dealer Bond

During the checkout process, you will choose an activation date. This is called an effective date which is also your bonds expiration date.

As your expiration date approaches you'll need to renew your bond for the following 12 month period.

As long as you're in business, you will need an active bond on file with the Commission.

If you purchase your bond with us, you get assigned your own bond specialist to manage your bond for you.

Your bond specialist will contact you about your bond 30 to 40 days before its expiration with renewal pricing ready to go so you can just pay and keep your bond active.

Once you pay your renewal premium, the bond you filed when you got licensed will automatically remain active. You will not have to file a new bond with the Commission.

Motor Vehicle Dealer Bonds And Getting Your New Jersey Business License/Registration

You can find all of the different license classifications and applications here. At a high level the steps to obtain your license include:

• Providing evidence of an established place of business meeting certain requirements
• The local municipality where your dealership is located must be approved
• List the full ownership information for the business
• Purchase the minimum amount of liability insurance
• Purchase your surety bond or multiple bonds if you're obtaining more than one license
• Pass a licensing examination on the regulations that govern the buying and selling of vehicles in New Jersey
• Complete your application and pay all required fees

When you're ready to get the surety bond process completed click here and complete our quote form. It's fast to fill out and if you prefer to speak with a person, call a bond specialist at 1-800-608-9950.