California Auto Dealer Bond

Under the California Code of Regulations, Title 13, Chapter 1, any person who sells more than five vehicles for profit in California must obtain the relevant auto dealer license from the California Department of Motor Vehicles Occupational Licensing. In order to obtain the license, you need a California motor vehicle surety bond. The most common bond is a $50,000 motor vehicle dealer bond, which starts at $300 per year. If you're a wholesaler, then you will need a $10k wholesale dealer bond. Either way, get started with our three minute quote flow below.

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.

Sample California Auto Dealer Bond Form
General Auto Dealer Bond

Bond Amount: $50,000

Required by: California department of Motor Vehicles Occupational Licensing

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Refund within 30 days
1 Year Bond Starts At
*Based on credit and experience

How Much Does a California Auto Dealer Bond Cost?

The cost of a California dealer bond is influenced by a range of factors, including the applicant's credit score, dealer experience, and the insurance company providing the bond. Among these, the applicant's credit score is usually the most significant. The exact cost usually ranges from 0.6%-10% of the bond amount required. The better your credit score and credit history are, the less expensive the bond would be. For a $50,000 motor vehicle dealer bond, our prices begin at $300 for a one year bond.

Note that multi-year discounts are also available if you buy for longer terms. Generally, at least 15% discount is applied per year for a multi-year bond. 

We have established partnerships with more than 10 insurance companies to provide our clients with highly competitive rates. If you happen to find a better deal elsewhere, please don't hesitate to let us know, and we will do our best to beat it.

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Commonly Asked Questions: 

What is a California Auto Dealer Bond

California auto dealer bond is a three party contract where the surety company (the surety) guarantees the California auto dealer (principal of the bond) will comply with California Code Section 11711 required by the Department of Motor Vehicle (the obligee). In the event that the dealer fails to comply with the terms in the California Code Section 11711, i.e., not remitting sales taxes to the government, committing title fraud or error, a claim can be filed against the bond to provide financial compensation to affected parties. The surety company will investigate if the claim is valid. If the claim is valid, then the surety company will pay up to the maximum bond amount. Then the principal of the bond (the dealer) will be required to reimburse the surety for all the money paid out, including attorney fees. 

Who Needs a California Auto Dealer Bond

Under the California Code of Regulations, Title 13, Chapter 1, any person that sells more than five vehicles for profit in California must obtain the relevant auto dealer license from the California Department of Motor Vehicles Occupational Licensing. In order to obtain the license, you need a California motor vehicle surety bond. The most common bond is a $50,000 motor vehicle dealer bond, which starts at $300 per year. 

What Are the Different Types of California Motor Vehicle Dealer Bond? 

There are three types of dealer bonds in California, corresponding to the three main types of dealer licenses

  • Retail Dealer Bond (Most Common): $50,000 dealer bonds meant for dealers to sell vehicles to the public and other licensed dealers
  • Wholesale-Only Dealer Bond: a $10,000 bond meant for dealers who sell wholesale to other licensed dealers, if you sell less than 25 vehicles. If you sell 25 or more vehicles wholesale in a year, then you will need a $50,000 bond
  • Motorcycle/All Terrain Dealer Bond (New and Used): A $10,000 bond needed by dealers  who sell motorcycles or all-terrain vehicles

If anything is unclear, please feel free to give us a call at (888) 236-8589 and we’ll help you figure out the right bond to get. 

How Do You Obtain the California Motor Vehicle Dealer Surety Bond? 

Simply start by filling out the form and provide the following information

  • Dealer name and any applicable Doing Business As (DBA)
  • Dealer address
  • Dealer owner legal name and Dealer SSN (a soft credit check is required)

Then we will use the information you provided to find the most affordable quotes among 10+ insurance partners we work with. If you are satisfied with the quote, we will send you a payment link. Once paid, we will email you the bond. 


How Fast Can I Obtain the California Motor Vehicle Dealer Surety Bond? 

You can get your surety bond within 4 business hours from the time you finish filling out your information on the form, as long as you make the necessary payment once we send you the payment link. 

How to Prove that I am Bonded? 

Once you have made a payment on your bond, we will send you a PDF copy of the bond via email as proof that you are bonded. You will simply need to print out the bond and sign at the appropriate spot. That signed hard copy would be your official bond.

Is a Credit Check Required for this Bond?

Yes, when evaluating applicants for the California auto dealer bonds, insurance companies perform a "soft credit check" to evaluate eligibility and pricing. It is important to note that this form of credit check does not negatively impact your credit score.

What if I Have Bad Credit? 

A credit score below 600 is typically regarded as "sub-standard." However, we have established partnerships with insurance companies that specialize in serving this market segment. If your credit score is less than ideal, please fill out the form as usual. The only thing to note is that if you have a bad credit, the price of your bond will be more expensive. We will still help you find the most affordable insurance quote by shopping around 10+ insurance providers on your behalf.

How Often Do I Need to Renew my Motor Vehicle Dealer Bond? 

Note that as long as your California auto dealer license is active and in force, your California auto dealer bond needs to be in force as well. The California auto dealer bond only has a minimum 1-year term so you would need to renew every year if you choose the 1-year bond term. We will send you a renewal invoice 60 days before your renewal is due. Note that you can also choose to pay for more than 1-year term and you will get additional discount on the bond price per year.

How to Get a California Auto Dealer License? 

Step 1: Determine the Type of Motor Vehicle Dealer License You Need 

  • Decide among New Dealer License, Used Dealer License, Wholesale-Only License and Autobroker’s Endorsement

Step 2: Complete a 6 Hour Pre-Licensing Training Course

  • A 6-hour pre-licensing training course focuses on laws and regulations of the CA Auto Industry and explains the steps it takes to become a licensed CA Auto Dealer
  • You can take the courses among many providers, including Dealer 101, Dealer Training, Redline Dealer Education

Step 3: Pass the Dealer License Test at Your Nearest DMV Licensing Office 

  • Pass a 40 multiple-choice-question exam. Scoring correctly 28 out of the 40 questions would mean a passing grade

Step 4: Determine Your Business Corporate Structure 

  • Corporation 
  • Limited Liability Corp (LLC)
  • Sole Proprietorship
  • Partnership 

Step 5: Set Up Your Business Corporate Structure and Complete the Required Documents  

Step 6: Obtain Your Federal Employer Identification Number (FEIN)

  • You can apply for a federal employer identification number on the official IRS website

Step 7: Apply for a Business Bank Account

Step 8: Obtain Seller’s Permit from the California Department of Tax & Fee Administration

Step 9: Register with the California Secretary of State or County

  • You can use online filing services like Biz File online who can handle the registration and filing process for you

Step 10: Find a Dealership Location and Display Lot 

  • There are many requirements that the dealership location and display lot need to fulfill. For details, please check out our dealer license page 

Step 11: Install a sign 

  • A sign of 2x2 with business name, address and hours of operations is required to be posted outside of your office 

Step 12: City Business License

  • If you are located in certain cities and towns, you may need to obtain a Business License

Step 13: Obtain a Dealer Surety Bond

Step 14: Submit Application Through the Online Form

  • Complete the correct auto dealer application from the California DMV website

Step 15: Complete Live Scan Fingerprinting 

Step 16: Schedule and Accommodate a Site Visit by the DMV Inspector 

  • Schedule the inspection of your dealership location

Step 17: Receive your approved application in your mail. Now time to celebrate!