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Who Is Required To Purchase a South Dakota Vehicle Dealer Bond?
South Dakota has the following license classifications, each with its own bond requirement. Next to the license you'll see the required bond amount.
This amount is set by the South Dakota Motor Vehicle Division. I'll go into more detail about the bond amount, just know it's not the price.
- Motor Vehicle Dealer License - $25,000
- Motorcycle and Off Road Dealer License - $5,000
- Snowmobile Dealer License - $5,000
- Boat Dealer License - $20,000
- Trailer Dealer (over 3,000 pounds) - $10,000
If you're obtaining a motor vehicle dealer license you'll be licensed to sell not only cars and trucks, but motorcycles, off road vehicles, and trailers.
Get Your Bond Pricing Today
You can get pricing for your South Dakota auto dealer bond today. Click the button below. You need to know the amount of your bond.
Need Help? Call Us Today
Talk to a bond specialist today. They will help you find the surety bond you need and get you the lowest possible price. 1-800-608-9950
Why is a South Dakota Motor Vehicle Dealer Bond Required?
As you know, there are a lot of different licensing requirements. This surety bond is only one of these requirements.
Besides the surety bond requirement, the licensing process includes requirements like:
- Getting zoning approval from the city or county you're located in
- Providing a copy of the lease or deed for your property
- Purchase the required minimum insurance policies
- Passing criminal background check
And now you know this surety bond is your legally backed guarantee that you will operate your business according to Pennsylvania law and conduct business with your customers using fair and ethical business practices.
The Motor Vehicle Division requires all dealers to purchase this surety bond for the protection of the customers the dealers serve and to ensure sales taxes are paid. It's primarily for your customer's protection.
What Specifically Does the South Dakota Auto Dealer Bond Protect Against?
Despite going through the licensing process, securing a dealership location, and securing inventory, every year there will be a small number of licensed dealers who purposefully and financially harm their customers to make more money.
These fraudulent actions can include things such as:
- Improperly transferring a vehicle title
- Selling vehicles with no title or fabricated titles
- Lying about vehicle condition, accident history, or milage
- Stealing from customer deposits
- Failing to record all vehicle sales or failing to pay the correct amount of sales tax
If a dealership is found guilty of these actions or similar actions, a claim can be made against the surety bond for damages.
This is where the bond amount comes in. The maximum amount of financial compensation for any one claim or the sum of multiple claims is capped at this bond amount.
As you can see, this protects customers from being financially harmed by a dealership and it also protects the Department of Revenue from a dealership failing to pay appropriate sales taxes.
How Much Does a South Dakota Auto Dealer Bond Cost?
Purchasing a surety bond is not complicated. The high level process is:
- Get custom pricing based on your business
- Purchase the bond with the correct information
- Have your bond issued so you can submit it with your application
Step 1: Get Your Custom Vehicle Dealer Bond Pricing
Pricing for a bond is determined by a surety. A surety is a specialized insurance company that underwrites vehicle dealer surety bonds.
Custom pricing is determined by the surety looking at these 3 factors:
- The personal credit of the owner or owners
- Dealership experience and industry experience
- Any prior bond claims if you've had a dealership in the past
From these factors a rate is determined and this rate multiplied by the bond amount you need is the price you'll pay.
This price is one payment for the bond term of 12 months in South Dakota.
We are Surety Bonds Direct, a specialized surety agency. We work with the highest A-rated sureties to find our customers the lowest rate and price.
We don't even understand it but different sureties will quote vastly different rates. This will impact your price by hundreds of dollars.
Here is example pricing for the $25,000 dealer bond with rates we routinely see offered by different sureties. Notice how much the pricing changes.
| Bond Amount | Premium Rate | Total Cost |
|---|---|---|
| $25,000 | 0.05% | $125 |
| $25,000 | 1% | $250 |
| $25,000 | 2% | $500 |
| $25,000 | 3% | $7500 |
| $25,000 | 4% | $1,000 |
Click here and start the online quote process. It takes 90 seconds to submit your request.
If you prefer to speak with a bond specialist, you can call 1-800-608-9950.
Step 2: Purchase Your Vehicle Dealer Bond
When you request pricing from us, your quote is good for 30 days.
So while there's no rush to purchase your bond immediately, it's often a good idea to get this done so you're not waiting on it to submit your application.
Purchasing is as simple as completing an online purchase form or ordering over the phone.
Step 3: Have Your Vehicle Dealer Bond Issued
After your payment is processed, our bond issuance team will work on issuing your bond with the correct information including the:
- Correct bond form required by the Motor Vehicle Division
- Required signatures and seals
- Power of attorney
Your surety bond will have to be mailed to you. The Motor Vehicle Division requires the original bond to be filed with your application.
This will add an additional 3 to 5 business days for shipping. And this is another great reason to check-off the surety bond requirement when you start your application process.
You don't want the bond to be the last requirement you have to check-off and have to wait for shipping.
Renewing Your Auto Dealer Bond
As we've mentioned, your bond will expire one year (12 months) from the active date you choose when you purchased your bond.
At this one year mark is when you'll need to renew your bond to keep it active for the following 12 months.
We handle this process for you. You'll receive an email and call from your bond specialist 30 to 40 days before your bonds expiration date with renewal pricing ready to go.
Once you pay the renewal premium, your bond remains active.
You don't have to worry about having another bond issued. The initial bond you filed with our application will remain active year over year as long as the renewal premium is made on time.
Get Your Bond Pricing Today
You can get pricing for your South Dakota auto dealer bond today. Click the button below. You need to know the amount of your bond.
Need Help? Call Us Today
Talk to a bond specialist today. They will help you find the surety bond you need and get you the lowest possible price. 1-800-608-9950
Motor Vehicle Dealer Bonds And Getting Your South Dakota Business License/Registration
Each license classification has the same high level steps for obtaining your license. These steps include:
- Obtaining approval for your dealership zoning
- Providing a copy of the lease or deed for the property
- Purchasing your surety bond and minimum liability insurance
- A copy of a franchise agreement if you're selling new vehicles
- Plus making sure you meet all the requirements for your dealership location
Remember, it's best to get your surety bond pricing today. You'll have the exact price so you can plan accordingly. Keep in mind as well, your bond must be mailed to you after you purchase which will take a few days. Do not wait until the last minute to get this process done.
Overall you expect your auto dealer bond to be in the mail within 1 to 2 business days after you purchase.
Click here and start the online quote process. It takes 90 seconds to submit your request.
If you prefer to speak with a bond specialist, you can call 1-800-608-9950.
Your dealership application requires a surety bond called an auto dealer bond. Learn what this bond is and how to buy it for as little as possible!
This video is going to make it easy to understand how much your surety bond will cost.
What's a Surety Bond And Why Is It Required?
This short video will break down what a surety bond is so you understand why it's required and how much it will cost.
What Are the Steps to Get an Auto Dealer Bond?
Getting an auto dealer bond typically takes between 1 to 2 business days.
Surety Bonds Direct is a specialized surety agency. We work directly with the A-rated surety companies who offer the lowest rates on auto dealer bonds.
Here are the 3 steps to get an auto dealer bond:
Step 1 - Request a Bond Specialist To Shop For You
When you request pricing from Surety Bonds Direct, your bond specialist will begin hitting the phones to find you the lowest price from network of sureties.
A surety is the insurance company who writes auto dealer bonds.
This process can be near instant or it may require a few hours depending on:
This process typically takes less than one business day. Keep in mind the pricing for your bond will be based on:
- Personal credit history or the owner and/or owners
- Dealership history and industry experience
- Past bond claims from ownership if they've been licensed in the past and had a past claim
Step 2 - We'll Call You With Your Pricing
Your bond specialist will call and email you with the lowest pricing they were able to obtain.
Up to this point, there is no cost to you.
Our price quotes can save you hundreds of dollars on your auto dealer bond. See for yourself, request your free pricing now.
Take the money you save and put it towards:
- Application fees
- Examination requirements
- Liability insurance costs
- Fingerprint and background check fees
Step 3 - Accept And Get Your Bond Issued
If you accept your auto dealer bond pricing, your bond specialist will help you complete the purchase process.
Purchasing is as easy as ordering anything online. Purchasing takes 90 seconds to complete.
Once your purchase is finished our bond issuance team will get your bond ready and issue to you within one business day.
Most states allow auto dealer bonds to be emailed.
Other states require the bond to be printed and mailed to you.
Once you have your bond you can submit it with your application.
You're now, officially bonded.
An auto dealer surety bond is a type of insurance you're required to purchase as a guarantee that you will:
- Fulfill your promises to deliver quality vehicles (or parts) to the public and/or other dealerships
- Manage the vehicle purchase process for your customers
- Follow all dealership laws and regulations in your state
- And pay all appropriate sales taxes
An auto dealer surety bond is a requirement to obtain a dealer license in your state.
It's unfortunate, but there is no way around providing the required level of protection your state requires.
Why Are You Required To Purchase an Auto Dealer Bond?
Your state requires all classifications of vehicle dealers to be licensed.
And even with this licensing requirement, there will always be a handful of licensed dealers who financially harm their customers on a purpose to make more money.
Acts of misconduct or fraud can include:
- Falsifying a vehicle title to make a sale
- Fail to transfer a title correctly
- Lying out the condition or milage of a vehicle
- Steal from customers deposits
- Fail to pay sales tax on vehicles sold
It's because of these "fraudulent dealers" that your licensing agency requires every dealer to purchase a surety bond before legally selling in the state.
How Can You Save Money Buying an Auto Dealer Bond?
The price (or premium) of an auto dealer bond is determined by a surety.
A surety is an insurance company that underwrites surety bonds. (Not all insurance companies provide surety bonds.)
Every surety does their own assessment when providing a price for an auto dealer bond.
This means prices will be different from one surety to the next.
How Is Price Determined?
For auto dealer bonds (except Ohio), the surety will consider:
- Credit of the owner or owners
- Industry and business experience
- The history of customer claims against dealers in your state
(If you're an Ohio dealer, we've secured a low fixed price for your required $25,000 dealer bond.)
Because the price quoted by each surety will be different, using a specialized surety agency like Surety Bonds Direct can help you save money.
How to Potentially Save Hundreds of Dollars
We work with our network of proven, A-rated sureties to price shop for you and find the lowest possible price.
The best part is, you're under no obligation to purchase once we find you pricing.
You have nothing to lose to have us get you pricing and see how low of a price you can get.
We've saved our customers hundreds of dollars when purchasing their auto dealer bond.
This is money you can use to pay:
- Application fees
- Examination fees
- Additional insurance costs like liability insurance
- For dealer plates
- Getting your dealership sign made
- Other fees or costs to get your business up and running
Purchasing an Auto Dealer Bond Is Easy
If you agree to the low price we'll found you, purchasing your auto dealer bond is as easy as completing an online checkout form.
After a successful purchase, our issuance team will:
- Prepare the correct bond form
- Collect the necessary signature
- Ensure the seals are in place
- And provide the power of attorney
Some auto dealer bonds must be physically mailed to you so you can turn in the original bond with your application.
Most auto dealer bonds can be emailed to you so you can submit a copy of the bond with your application.
Let Us Manage This Process For You And Save Your Money!
If this is your first time purchasing an auto dealer bond, this process may be new to you.
Let's us manage everything for you so:
- You do not overpay for your auto dealer bond
- You can get the process done quickly and correctly
Click here and choose your state to get started.
If you're unsure of the bond you need, fill out our free online quote form and provide as much details as you can.
Our system will find the bond you require or a bond specialist will call you can help you get this process done.
How Much Does An Auto Dealer Bond Cost?
Click here if you don't know what an auto dealer bond is.
The price of an auto dealer bond is determined by a surety.
A surety is an insurance company that specifically underwrites surety bonds. (Not all insurance companies provide surety bonds.)
Every surety does their own - independent - assessment when providing a rate for a surety bond.
This means you'll get a different price from each surety.
And this means the lowest rate can save you hundreds of dollars.
How is an Auto Dealer Bond Price Determined?
All states (except Ohio) require a custom rate quoted by a surety to determine exact pricing.
The rate quoted by a surety are based on:
- Credit of the owner or owners
- Industry and business experience of the business
- Any prior bond claims if there are any from previous licenses held
- Plus the overall landscape of the dealership claims in the state
Using a specialized surety agency like Surety Bonds Direct will save you money.
How Much Money Will You Save?
We work with our network of proven, A-rated sureties to price shop for you and find the lowest possible price.
The best part is, you're under no obligation to purchase once we find you pricing.
Having helped thousands of auto dealers across the country...
The price difference between rates can be hundreds of dollars.
**With the money you save, you can pay:
- Application fees
- Examination fees
- Additional insurance costs like liability insurance
- Other fees or costs to get your business up and running
Purchasing an Auto Dealer Bond Is Easy
If you agree to the low price we find you, purchasing your surety bond is as easy as completing an online checkout form.
After a successful purchase, our issuance team will:
- Prepare the correct bond form
- Collect the necessary signature
- Ensure the seals are in place
- And provide the power of attorney
Some auto dealer bonds must be physically mailed to you so you can turn in the original bond.
Most auto dealer bonds can be emailed to you so you can submit a copy of the bond.
Let Us Manage This Process For You And Save Your Money!
If this is your first time purchasing an auto dealer bond, the concept may be new to you.
Let's us manage the process for you so:
- You do not overpay for your surety bond
- Get the process done quickly and correctly
If you know the bond you need, click here and choose your state to get started.
If you're unsure of the bond you need, fill out our free online quote form and provide as much details as you can.
Our system will find the bond you require or a bond specialist will call you can help you get this process done.
Can't find what you're looking for? Let us help!
Get Started » or, if you'd prefer, call us at
(No obligation, takes 2 minutes)