Oregon Auto Dealer Bond

 

Oregon Auto Dealer Bond

Most auto dealers must provide the Oregon Department of Transportation (ODOT) a $50,000 surety bond to receive and maintain a license. The Oregon Auto Dealer License Bond requirement provides the public protection from loss or damage caused by a vehicle dealer’s fraudulent or irresponsible activities. Dealerships who only buy and sell motorcycles, ATVs, snowmobiles, and mopeds must only provide ODOT a license bond in the amount of $10,000.

PURCHASE AUTO DEALER BOND

Jet provides auto dealers direct access to surety underwriters and claims handlers without any agents or brokers in the middle. Eliminating the middleman dramatically simplifies the bond purchase and filing process with the lowest rates, a no down payment and no obligation monthly payment option, and the best defense should anyone ever make a claim on your bond.

What's the Lowest Price for the Oregon Auto Dealer Bond?

By cutting out the middleman, who collects fees and commissions, Jet is able to provide the $50,000 motor vehicle dealer license bond for as low as $31 per month. Many dealers choose a three-year bond term, which we offer for just $758, to align their bond term with their license. As the chart below illustrates, dealers that only offer motorcycles, ATVs, snowmobiles, and mopeds can get their license bond from Jet for $10 per month.

Oregon Motor Vehicle Dealer Bond Price
Bond Limit Monthly 3-Year Term
$10,000 $10 $250
$50,000 $31 $783

 

Your personal credit and experience determine the rate you receive, but this does not slow down the purchase process with Jet, which only takes about 3 minutes online. Rates in the chart are not an offer of surety, you will have to qualify online.

Jet is the only company to offer monthly payments on the Oregon Motor Vehicle Dealer Bond. A few brokers will help you finance premium through a specialty premium finance company, but those offers come with 30-40% down payments and 20-30% APRs! Jet’s monthly payments are included in its rate filing with the Oregon Department of Insurance and require zero down payment, zero interest and zero fees. As long as the credit or debit card you provide Jet clears, your bond remains in force - it’s that simple! And don’t worry - if anything ever happens to that card, we follow up to get a replacement well before sending in a notice of cancellation. The best part is that unlike with the brokers, you can cancel the bond at any time by simply stopping payment so you truly only pay for what you use.

Can Jet File the Bond for Me?

Yes! Jet will file the bond with the DMV Business Licensing Unit for you. Other carriers, or their agents and brokers, will charge you a fee to send you the bond to sign and then you still need to send the bond form to the DMV on your own dime. You will receive a copy of the bond for your records following the purchase of the bond online. 

If you are planning to file the bond with other paperwork you need to send to the DMV, as in the case for new dealers described by the DMV, we will send you the original bond form with the raised seal free of charge. Both options are easily selected within our online application.

The Oregon Auto Dealer Bond is filed directly to the address below:

Oregon Department of Transportation
DMV Business Licensing Unit
1905 Lana Ave NE
Salem, OR 97314

With Jet as your surety partner, you can focus on buying and selling cars and leave the paperwork to us!
 

Can I Cancel my Auto Dealer Bond and Get a Refund?

You can with Jet! Motor vehicle dealers can cancel the bond at any time and Jet will send back a prorated refund for the remaining time on the bond. Other carriers withhold “minimum earned” amounts and agencies sneak fine print in their “brokers agreements” allowing them to keep all their commissions leaving the dealer with pennies on the dollar, even if the bond was only active for a short period of time. On top of that agencies and carriers apply cancellation and reinstatement fees.

Jet’s monthly payment option makes it even easier for dealers in Oregon to manage their bond. Cancel at any time and don’t worry about wasting a dime.

The Oregon Department of Transportation requires 30 days notice before the bond is cancelled which unfortunately reduces the time remaining on the bond and therefore must be factored into the prorated refund. With Jet, if you change your mind after cancelling or you were late on a payment you won’t fall into a suspended license if addressed with Jet within that 30 day grace period.

How Do Motor Vehicle Dealers in Oregon Avoid Bond Claims?

The most common claim on motor vehicle dealer bonds in Oregon involves dealers selling cars without a free and clear title, so making sure you transfer title appropriately to the car buyer is the best way to avoid any issues for your bond and consequently your license. To avoid all claims, auto dealers must abide by the dealer regulations set forth by the Oregon Department of Transportation vehicle code, which are summarized in the following list:

If a customer brings a complaint or concern, it is in your best interest to respectfully hear them out and address the complaint, if possible, to avoid the customer bringing their complaint to ODOT. Part of the Oregon Department of Transportation Motor Vehicle Services Department’s mission is to protect financial and ownership interests in vehicles with a mandate to investigate dealers following any complaint. The last thing any dealer wants is for an ODOT investigator to conduct a lengthy examination. The ODOT investigator will look for similar infractions to the original complaint because they assume where there is smoke, there is fire. Dealers with multiple infractions quickly rack up significant penalties and fees.

What Happens If a Claim is Filed on My Dealer Bond?

Jet will notify you the moment we are notified of a claim by the claimant or ODOT. You will want to provide any and all related information directly related to the incident(s) as Jet only has 45 days to investigate the claim. Jet’s claim department works hard to weed out frivolous accusations and assist dealers in their defense. Should the claim be valid, Jet will pay the claimant. 

Unlike a business insurance policy, which protects the dealer from unforeseen accidents, a surety bond protects the public, usually a dealer’s customers, from the unlawful actions of the dealer, such as messing with a car’s VIN. Dealers are ultimately responsible for their own actions and therefore must reimburse the surety company for any claims paid. Think of the surety as providing you a letter of credit that you need to demonstrate to ODOT that it’s safe to license you to sell cars to the public. 

While other carriers may try to avoid legal fees by quickly paying claims and then seeking reimbursement from the dealer, Jet prefers to help dealers resolve claims amicably with the claimant, and ideally avoid them altogether. 

While there is a rule requiring the Oregon Department of Transportation to respond to a claim within 25-30 days depending on whether the underlying vehicle transaction was financed or settled in cash, neither ODOT nor the Oregon Department of Insurance specify how quickly the dealer license bond claim must be handled.

In the absence of a specific rule or law mandating how claims must be handled for motor vehicle dealer bonds, Jet utilizes the Oregon insurance regulations for claim handling. Jet will respond to the claimant within 30 days of the notice and provide the claimant and dealer with all instructions and forms for the related claim on the license bond. With a proper claim filing, including a proof of loss form, Jet will perform its investigation of the claim certifying if the claim is valid. The investigation period can be up to 45 days from the claim notice and Jet may request additional time if necessary, but generally the claim should be paid, if deemed valid, within 45 days of the surety company receiving notice of the claim. Jet strives to ensure our decision is justified before accepting or denying a dealer bond claim. 

In the event a valid claim is paid, Jet will immediately notify ODOT placing the dealer’s license under suspension until the dealer reimburses for the claim. Remember, Jet acts as a guarantor to ODOT that dealers will rectify any valid claims. 

The max amount the bond will payout to a retail customer of the dealer is $50,000. Any other claimant on the bond can only claim a maximum of $10,000. 

Why Does Oregon Require Dealers to Purchase a License Bond?

The Oregon Department of Transportation Driver and Motor Vehicles Service Division is charged with protecting “financial and ownership interests in vehicles” for the customers and counterparties of the 2,200 licensed auto dealers in Oregon. The required auto dealer bond is a tool to financially protect the public from the consequences of a dealer committing an infraction of the laws that govern their dealer license, such as not transferring title with the sale of a car.

If the public is harmed financially, the surety bond guarantees recompense. By involving the insurance industry, Oregon’s state government leverages the surety carriers’ financial strength and expertise in handling time-consuming situations that can cause additional departmental expenses for ODOT.

How Does the Application Process Work For the Bond?

While many agents and carriers require dealers to go through a cumbersome process to obtain a surety bond, including paper applications, indemnity agreements, third party premium finance applications, 24+ hour quote turnaround times, etc., getting a license bond for your dealership is easy with Jet. Click the button below that corresponds to your dealership, answer a few easy questions, select your terms and provide your payment information in our secure system. Jet’s website will allow you to execute your bond entirely online in about 3 minutes. 

PURCHASE AUTO DEALER BOND

 

How To Renew the Oregon Motor Vehicle Dealer Bond?

It doesn’t have to expire with Jet. What Jet provides that other carriers and agents cannot, is the ability to purchase the bond on monthly payment terms. As long as the monthly payment is made the bond does not expire and can be cancelled at any time if the dealer decides to stop paying the monthly premium. 

Unlike with some other license bonds, the expiration date of the Oregon auto dealer bond does not need to match the license certificate, although many dealers prefer that they do match. Vehicle Dealer Certificates are valid for three years after which the dealer will need to renew their license with ODOT. 

When Does a Motor Vehicle Dealer Bond Expire in Oregon?

It doesn’t have to expire with Jet. What Jet provides that other carriers and agents cannot, is the ability to purchase the bond on monthly payment terms. As long as the monthly payment is made the bond does not expire and can be cancelled at any time if the dealer decides to stop paying the monthly premium. 

Unlike with some other license bonds, the expiration date of the Oregon auto dealer bond does not need to match the license certificate, although many dealers prefer that they do match. Vehicle Dealer Certificates are valid for three years after which the dealer will need to renew their license with ODOT. 

Consequences for Dealers Operating without a Surety Bond

According to the Oregon Vehicle Code, section 822.045, it is illegal for auto dealers to not purchase a bond or letter of credit substitute, or to allow an interval where a bond is not active. A dealer’s failure to uphold a bond is considered as a Class A misdemeanor, punishable by a fine up to $6,250 or up to one year in jail. That said, the most common punishment for not having a bond is a suspended license. 

 

Oregon Auto Dealer Bond Form