Alabama Auto Dealer Bond


Alabama Auto Dealers are required by the Department of Revenue's Motor Vehicle Division to maintain a $50,000 Motor Vehicle Dealer Bond. The bond is required for dealers to acquire and maintain their auto dealer licenses. The licensing requirement applies to all auto dealers in Alabama, which includes new, used, franchised and wholesale dealers. The specific requirement is outlined in the Code of Alabama 1975.

Our team has navigated this process extensively and have successfully helped many dealers in Alabama obtain their bonds. To get started, simply fill out our quick three-minute form, and we'll provide you with an instant quote.

Quick Overview

  • Who Needs It: all new, used, and wholesale dealership that sells automobiles, RVs, and/or motorcycles. Auto rebuilders also need the bond
  • Bond Amount: $50,000 for new, used, and wholesale. $25,000 for auto rebuilders
  • Cost: Starts at 0.5% of the bond amount. $250 for the $50,000 bond and $125 for $25,000 bond

Please note this page is for car dealer licensing. If you're trying to register a vehicle with a missing title, a separate Lost Title Bond is required.

Motor Vehicle Dealer Bond

Bond Term: 1 Year

Required By: Alabama's Department of Revenue's Motor Vehicle Division

green checkmark
State Acceptance Guarantee
green checkmark
Refund within 30 days
1 Year Bond Starts At
*Based on credit and experience

How much does it cost?

Our rates for the $50,000 Alabama Motor Vehicle Dealer starts at $300 for a 1 year bond. The price of the bond is determined by a soft credit check of the owner. In general, having a higher credit score will often lead to lower bond prices. Additionally, some dealers may be eligible for discounts based on their prior work experience. If you choose to bond with us, we’ll shop around for you with our 10+ insurance partners to ensure that you get the best pricing. If you find a better quote elsewhere, show us and we’ll do our best to match. We know how important pricing is to our customers and we strive to provide industry low prices.

Example auto dealer lotpurple money

Alabama Auto Dealer Bond Common FAQs

Are there other related motor vehicle dealer bonds in Alabama?

Yes, there is a separate $50,000 Automotive Dismantler and Parts Recycler bond for auto recycling businesses. We offer this type of bond as well, and you can select it from the “Specific Bond” dropdown when going through the quote process for an Alabama auto dealer bond.

Is a credit check needed for this bond?

Yes, but it won't hurt your credit score. When you apply for an Alabama auto dealer bond, the insurance companies will check your credit to see if you're eligible and to decide how much it will cost. This type of credit check is called a "soft" credit check, and it doesn't harm your credit score.

How long does it take to get bonded?

Our goal is to offer same-day bonding service in most situations. Once we receive a quote from our insurance partners, your pricing is set, and the process can be completed immediately. We work hard, even on weekends, to ensure a quick bonding process. Our work hours are Monday to Saturday from 9:30 am to 7 pm CST, and on Sunday, our hours are from 11:30 am to 7 pm CST. We're the only surety agency that provides service on weekends.

How can I avoid claims against my bond?

You can minimize the chances of bond claims by adhering to the auto dealer guidelines specified by the state of Alabama. Most of this is just conducting business in a truthful and transparent manner, with a focus on prioritizing the customer's best interests. This involves ensuring that all fees and taxes associated with vehicle sales are paid appropriately, and that customers receive valid car titles. By submitting your bond, you're verifying your promise to fulfill all legal responsibilities connected with operating an auto dealer business in Alabama.

Does the bond expire?

Yes, if you go with a 1 year term, then the bond expires 1 year after the bond start date and the bond must be renewed before the expiration date to maintain your license. If you choose to bond with us, we’ll handle renewals for you so you can focus on your business. We’ll even shop around for you during renewal to see if the price can be lowered.

What factors go into pricing?

The cost of an Alabama dealer bond is influenced by different factors, such as the applicant's credit score, dealer experience, and the insurance company providing the bond. Generally, the credit score is the most important factor, followed by the insurance provider. To ensure our clients receive the best possible rates, we partner with over 10 insurance companies that offer competitive pricing. If you come across a better price elsewhere, please let us know, and we'll do our best to match it.