The Maryland Motor Vehicle Administration requires auto dealer bonds that correspond with the dealer license type. The bonds, which vary in limits from $5,000 to $300,000, are mandatory for new vehicle and motorcycle dealers, used vehicle and motorcycle dealers, and trailer and boat trailer dealers.
Once the bond is purchased, the original will be sent to you to file with your inspector. New applicants will need to send in the original copy of the bond with the rest of their paperwork.
|Number of Vehicles Sold||Bond Amount||
Monthly | Annual
|New Vehicle & Motorcycle||1 – 500||$50,000||$32 | $375|
|501 – 1,000||$75,000||$47 | $563|
|1,001 – 2,500||$100,000||$63 | $750|
|over 2,500||$300,000||$175 | $2250|
|Used Vehicle & Motorcycle & Wholesale||1 – 250||$15,000||$11 | $113|
|251 – 500||$25,000||$16 | $188|
|501 – 1,000||$35,000||$22 | $263|
|1,001 – 2,500||$50,000||$32 | $375|
|over 2,500||$150,000||$93 | $1125|
|Trailer and Boat Trailer Under 15 feet||/||$5,000||$10 | $100|
|Trailer and Boat Trailer Over 15 feet||/||$15,000||$11 | $113|
The bond amount is determined based on the type of dealer and the number of vehicles sold within the last year or projected to sell in the upcoming year. New vehicle and new motorcycle dealer bond limits start at $50,000 and top off at $300,000.
Used vehicle, used motorcycle, and wholesale dealers have a similar separation in pricing based on the number of cars sold, but the limit and pricing are lower. The lowest limit for these types of dealer bonds is $15,000 and can go up to $150,000.
Trailer and boat trailer dealers have a set bond amount of $5,000. However, if the trailers being sold are over 15 feet in length, a $15,000 bond is required.
A surety bond reinforces the agreement between the dealer and the public that the dealership is conducting business in an ethical way. Acting as a safety mechanism, the bond will repay a customer if the dealer has violated Maryland laws during a business transaction. The customer will be covered immediately, but then must repay the surety company what was paid out to the customer.
A car dealer bond is just one aspect of receiving a vehicle dealer license in the State of Maryland and must be included when submitting the dealer license application.
Firstly, the dealer must know the level of bonding they are required to have. This can be evaluated by checking the chart, looking at the type of dealer and the number of vehicles expected to sell.
A dealer license number is also needed, as well as business names that correspond with the dealer license application. The full name of the dealership, along with any trade name, must be accurately filled out.
Any officers’, partners’, or owners’ names used in the application must be fully recorded in accordance to the application.
The name and address of the bonding company and the date the bond is effective will be filled out during the bonding process with Jet Surety.
Lastly, the signatures of the owner, any partners, the principal, and the surety are required to validate the bond and launch it into effect.