Colorado Car Dealer Bonds
The motor vehicle dealer bond is a requirement in order to be a licensed dealer in Colorado. There is a $50,000 bond for dealers of new and used motor vehicles and powersport vehicles, as well as wholesale dealers and wholesale auction dealers. There are smaller bond limits required for other types of dealers, as you will read below.
By shopping with several major insurance carriers, Jet works hard to deliver the lowest prices in the market. Bonds, along with the power of attorney, are sent to the dealer to file with their inspector.
How Much Does a Surety Bond Cost in Colorado?
Choosing Jet gives you the best chance of finding the lowest price. We search through various insurance companies to keep our rates as low as possible.
For salespeople, Jet can offer a rate of $100 annually for those who qualify. Motor vehicle and wholesale dealers are offered rates as low as $21 monthly or $250 annually when they meet the qualifying factors. Even in cases of bad credit, Jet strives to keep competitive pricing.
|Price Tier*||Motor Vehicle/Powersport Salesperson||Motor Vehicle Wholesale Dealers|
|Monthly | Annual||Monthly | Annual|
|Preferred||$10 | $100||$21 | $250|
|Standard||$19 | $225||$47 | $500|
|Credit Repair||$42 | $450||$94 | $1000|
*Dealer bond prices are dependent on dealer’s personal credit, years in business, license type, and other factors. Please note that the chart does not reflect all available price tiers. These rates may change at any time, and are not a guarantee.
Other Auto-Related Bonds in Colorado.
Along with the Motor Vehicle Bond, Colorado requires a Buyer Agent Bond and a Motor Vehicle or Powersports Vehicle Salesperson application.
A buyer agent is someone who works with a consumer to represent them in the purchase of a vehicle. This person cannot receive payment from dealerships, either from fees of employment. The bond for a buyer agent must be in the amount of $5,000.
Motor vehicle or powersports salespeople must also have a bond in Colorado. This bond must be in the amount of $15,000.
How to Renew Your Dealer License?
Thirty days before expiration, the Auto Industry Division will mail a license renewal packet to your primary place of business. When filling out the Dealer License Renewal Application specifically, it is important to completely answer questions 1-4 of the application. All forms submitted to the Auto Industry Division must have your full legal name match your identification card or driver’s license.
The renewal must have bond coverage for the new license period. A new $50,000 bond may be issued, or you can submit a continuation certificate to extend coverage. Photocopies of the certificate are permitted.
You must provide secure, verifiable identification of any owners, partners, members, or officers.
You must declare lawful presence in the United States by signing an affidavit. Legal documentation is needed as proof of your status.
A fee of $474 is required for a dealer license renewal.
The renewal application must be completely filled out before submitting to the Auto Industry Division.
Other Useful Information for Colorado Dealers.
There are many important requirements, other than the bond, in order to become a licensed dealer. Here is a checklist to help with the process:
- Application (DR 2109)
- License Fee – Fee depends on the type of dealer license you carry and changes yearly
- Addendum (DR 2109B)
- Pre-Licensing Education Program Certificate
- Mastery Exam
- Examination Affidavit
- Surety Bond
- Secure Variable Identification
- Affidavit – Restriction on Public Benefits
- Statement of Financial Condition
- Certificate of Good Standing from Colorado Secretary of State
- Constituent Filed Document
- Trade Name
- Business Plan
- Place of Business Affidavit
- Franchise Agreement
- Dealer Plate Affidavit
- Sales Tax License
- Written Correspondence
More detailed information can be found on Colorado Department of Revenue Dealer/Wholesale Checklist (DR2248).