Sun, sand surf, and mountains, the Golden State is known worldwide for its beautiful climate and sceneries. As the largest state by population, California is the home of the largest number of motor vehicle dealers. However, the state has strict laws regulating the automotive industry. 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 based on the Section 11710 of the Vehicle Code. 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.
You can click on the “Quote” button below to obtain your CA Auto Dealer Bond quote.
No, you only need one bond for multiple operations. You would need the bond with a larger sum. For example, if you sell both motorcycles and used motor vehicle dealers to regular citizens (not licensed dealers), then you simply need to purchase the $50,000 since it is the higher coverage one compared to the $10,000 motorcycle bond.
You only need one bond for as many locations as you have. For example, a used dealership with one location needs the same one $50,000 bond as a dealership with 10 different locations.
The bond is used to protect the California consumers from the potential fraudulent acts of unscrupulous bonded auto dealers. Some of the unethical acts include the following:
If any of the unethical practices above exist, a customer can file a claim against the bond
The CA Auto Dealer Bond needs to have its bond term consistent with the CA Auto Dealer License. Since the CA Auto Dealer License is renewed on an annual basis, the bond typically is only for a one-year term and renewed annually.
To ensure your bond is accepted by the DMV, you can do a few things:
Credit score is the most important determinant of the bond price that you can actually control. Having a great credit score can lower the price of your bond significantly. There are a few things you can do to improve your credit score
Given that the state DMV accepts electronic versions of the bond, you can receive the bond within 30 minutes after bond purchase. We will email a fully signed bond to your email inbox. All you need to do is sign your bond and then submit to the CA DMV.
Even though the Occupational Licensing Branch of the Licensing Operations Division of the CA DMV has its address clearly indicated on the top left of the bond form, you should submit your bond electronically through the Occupational Licensing Login
There are many steps in the application process for a CA Auto Dealer License. We have defined the specific steps below where obtaining a dealer bond is step 13. However, to obtain a really good rate for your dealer bond, you can also obtain it as soon as you have a business name. All we need in order to secure you a rate for your bond is your own social security number and a valid name of the dealership. The sooner you lock down an affordable bond rate, the more peace of mind you have.
A hardcopy of your bond is not required for your CA Auto Dealer Bond application. The bond we email you is the final bond with electronic signature and digital seal. All you need is print out the bond we emailed you and submit the bond we emailed you to the Occupational Licensing Branch of the Licensing Operations Division of the CA DMV
Step 1: Determine the Type of Motor Vehicle Dealer License You Need
Step 2: Complete a 6 Hour Pre-Licensing Training Course
Step 3: Pass the Dealer License Test at Your Nearest DMV Licensing Office
Step 4: Determine Your Business Corporate Structure
Step 5: Set Up Your Business Corporate Structure and Complete the Required Documents
Step 6: Obtain Your Federal Employer Identification Number (FEIN)
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
Step 10: Find a Dealership Location and Display Lot
Step 11: Install a sign
Step 12: City Business License
Step 13: Obtain a Dealer Surety Bond
Step 14: Submit Application Through the Online Form
Step 15: Complete Live Scan Fingerprinting
Step 16: Schedule and Accommodate a Site Visit by the DMV Inspector
Step 17: Receive your approved application in your mail. Now time to celebrate!