Ohio Motor Vehicle Dealer Bonds
What is an Ohio Motor Vehicle Dealer Bond?
Those applying for a used motor vehicle dealer license in Ohio on or after January 27, 2018 are required to furnish a surety bond in the coverage amount of $25,000. This surety bond is mandated pursuant to Chapter 4517 of the Ohio Revised Code. The business name on the bond must exactly match that on file with the Bureau of Motor Vehicles and the Secretary of State. The surety bond is post with the Attorney General's office, payable to the State of Ohio. The surety bond is issued solely for the purpose of replenishing funds the Attorney General has dispersed from the Title Defect Rescission Fund to compensate retail purchasers of motor vehicles, pursuant to Ohio Revised Code § 4505.181.
Why is an Ohio Motor Vehicle Dealer Bond Required?
The Ohio Motor Vehicle Dealer Bond Principal ensures that the licensed dealer will promptly compensate any retail purchaser of a motor vehicle who is financially damaged due to failure of the bonded principal, an employee or other person acting on behalf of the bonded principal. This surety bond also ensures prompt reimbursement of the Attorney General for any payments made from the Title Defect Rescission Fund to a retail purchaser or the lender of the retail purchaser of the bonded principal. Lastly, the surety bond provides a limited guarantee of compliance with Ohio Revised Code § 4505.181 and Ohio Administrative Code 4501:1-3-11, as amended.