What is a South Carolina Motor Vehicle Dealer and Wholesaler Bond?
An auto dealer surety bond is a license requirement the South Carolina Department of Motor Vehicles requires for dealers before they’ll issue your license.
An auto dealer bond is a special type of insurance acting as a guarantee that an auto dealer will follow all South Carolina dealership rules, requirements, and service their customers with honest business practices and ethics.
By purchasing an auto dealer bond, you're making this guarantee to the South Carolina DMV and your customers.
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Why is a South Carolina Motor Vehicle Dealer Bond Required?
There will always be a few dealerships who willfully break the rules to increase profits, causing the state or the customer financial damage, such as:
- Transferring a vehicle’s title incorrectly or failing to transfer the title
- Selling vehicles with a missing title
- Lying about a vehicle’s mileage, manufacture year, or condition to make a sale
- Stealing customer deposits
- Neglecting to pay the correct sales taxes to the Texas Department of Revenue
One responsibility of the The South Carolina Department of Motor Vehicles is to protect the public from being cheated by fraudulent dealers.
This is why the Department requires motor vehicle dealers to be licensed. And part of the licensing process is purchasing a surety bond.
The surety bond (auto dealer bond) is your financial commitment and guarantee that you will follow the rules and give your customers the best service.
How Much Does a South Carolina Auto Dealer Bond Cost?
The South Carolina auto dealer bond requires a quoted rate from a surety. The surety is the insurance company that writes surety bonds.
The surety will determine the rate based on:
- Primarily your personal credit
- Business industry and experience
- Prior bond claims if they exist
The rate quoted by the surety multiplied by the bond amount is the price you pay.
Every surety determines their rates and underwriting guidelines using their own proprietary assessment. This means finding the lowest rate can save you hundreds of dollars.
And this is why you should work with a specialized surety agency like Surety Bonds Direct.
When you request your free quote, we'll work with our network of A-rated sureties and find you the lowest possible price.
Example prices from really good to average are:
| Bond Amount | Surety Bond Rate | Price You Pay |
|---|---|---|
| $50,000 | 0.5% | $250 |
| $50,000 | 1% | $500 |
| $50,000 | 2% | $1000 |
| $50,000 | 3% | $1,500 |
| $50,000 | 4% | $2,000 |
| $50,000 | 5% | $2,500 |
But the only way to know your price is to request a free quote.
Click here to start the quote process. Starting your quote today means you can a firm price quote in one business day.
Once you receive your pricing, you’ll be able to make the right decision for your business and goals.
How Long Does The South Carolina Auto Dealer Bond Last?
All South Carolina dealer bonds have a bond term of 1 year.
As your bond expiration approaches, you'll have to renew your bond to keep it active. South Carolina dealer bonds are continuous.
This means when you pay the renewal premium, your bond remains active. You don't have to have a new bond issued each year. The process is seamless.
Renewing your bond is easy.
Your bond specialist will verify prices in advance and contact you 30 to 45 days in advance to make sure the renewal premium is paid on time so your bond remains active.
Once you pay the renewal premium, you don't have to do anything else. Your bond remains active (that's why it's called a "continuous") and you can continue selling vehicles.
Motor Vehicle Dealer Bonds And Getting Your South Carolina Business License/Registration
Read our blog post that will take you through the steps to get your South Carolina auto dealer license.
At a high level, the steps are:
- Decide on your license classification or classifications
- Complete the application
- Attend a pre-licensing course (non-franchised dealers only)
- Apply for a Department of Revenue Retail license so you can pay sales tax
- Apply and obtain a national criminal report
- Purchase the auto dealer bond
- Obtain the necessary liability insurance
- Secure an affidavit of eligibility for each owner who owns more than 10% or more of the business
- Submit the application and paperwork
- Have the dealership location inspected after application initial review
Can't find what you're looking for? Let us help!
Get Started » or, if you'd prefer, call us at
(No obligation, takes 2 minutes)