Auto Dealer Bond Massachusetts:
Get an Auto Dealer Bond in Massachusetts through Viking Bond Service
There are over 5 million registered vehicles in Massachusetts according to the industry group Auto Alliance. The average age of those vehicles is also almost 10 years old, meaning most will need to be replaced soon. That also means Massachusetts is an excellent state to set up an auto dealership. However, you will need a license first, and to get a license you will need a Massachusetts Auto dealer bond. Viking Bond Service can help.
Massachusetts Auto Dealership Bonds Explained
The Massachusetts Auto Dealer Surety bond is a License Surety Bond that serves to protect Massachusetts's citizens by providing a path for recourse in situations where an Auto Dealer does not adhere to the laws, rules, and regulations as set in Massachusetts state legal statutes. A Massachusetts Motor Vehicle Dealer bond may be required as part of the Motor Vehicle Dealer licensing and/or vehicle dealer registration process.
In Massachusetts, the required Motor Vehicle Dealer bond amount is as follows:
- Massachusetts, Used Motor Vehicle Dealer bond requirement – $25,000 Surety Bond
You should always check with the Massachusetts Department of Transportation Registry of Motor Vehicles, or requesting agency, for the most current required Massachusetts Motor Vehicle Surety bond amount, as well as the required bond forms.
writes Massachusetts Motor Vehicle Dealer bonds. We can assist both clients with good credit, and clients with bad credit. Typically, the worse the credit, the higher the surety bond premium will be. In either case, we always work to get the best quote for you. Viking has partnered with markets that welcome Massachusetts Motor Vehicle bond applications and provide competitive quotes for them.
What Parties Are Involved in a Massachusetts Auto Dealer Bond?
Like all types of surety bonds, there are three parties involved in an auto dealer bond:
- Principal - The motor vehicle dealer is considered the principal and is responsible for obtaining and renewing the bond. The principal is also responsible for paying any claims made against the bond.
- Obligee - The Massachusetts Department of Transportation Registry of Motor Vehicles is the obligee because it requires car dealers to acquire a bond before they are granted a license. As the agency responsible for regulating auto sales in Massachusetts, the obligee must be able to hold negligent dealers financially responsible for conduct that hurts consumers, tax payers, or the state-wide transportation and auto industries. Bonds provide that accountability.
- Surety - The company who underwrites and issues the Massachusetts motor vehicle dealer bond is known as the surety. When claims are filed against the bond by vehicle buyers who feel that they've been wronged, the surety will launch an investigation. If the claims are valid, the individual will be compensated by the surety, which will then seek repayment from the principal.
Who Needs an Auto Dealer Bond in Massachusetts?
If you plan to sell more than a few new or used vehicles over the course of a 12-month period, you are required to have both a license and a Massachusetts motor vehicle dealer bond. Failure to secure a bond and a license could lead to fines, having your business shut down, or being permanently barred from vehicle sales.
How Are Auto Dealer Bonds In Massachusetts Obtained?
By working with a surety company licensed to issue this type of bond in the state of Massachusetts. You will apply for a bond, and based on your application the surety will quote you a price for the yearly premium. The bond becomes active once the premium is paid, and the surety provides you with a document you can provide to the obligee to prove that you have an active bond.
The Cost to Obtain and Auto Dealer Bond in Massachusetts
Bonds cost just 1-4% of the premium. In Massachusetts, where auto dealers must have a $25,000 bond, premiums may only cost a few hundred dollars. Whether the total is higher or lower will depend on the applicant's credit score. Bad credit is not a disqualifier, but it does mean paying a slightly higher premium.
How to Renew a Massachusetts Auto Dealer Bond
Bonds are usually active for one year before they need to be renewed. During the renewal, underwriters reevaluate your credit and recalculate your premiums, meaning that they can go up or down on a yearly basis. Be sure to factor the cost of the bond renewal (usually around a few thousand dollars) into your annual operating budget.
(See Also: Cost Expectations for Auto Dealer Bonds)
How Viking Bond Service Can Help You Get a Massachusetts Auto Dealer Bond
You can't get a motor vehicle dealer license until you get a Massachusetts auto dealer surety bond. At Viking Bond Service, the application process is simple and straightforward, and you will get a quote back in as little as 24 hours. Here's what you need to provide:
- Basic information about your business
- Basic information about your finances
- Similar information from any business partners you have
- Additional information requested by the surety company
Once you apply, underwriters will immediately begin examining your information and preparing your quote. The bond becomes active as soon as you pay the premium, and then you can check an important box off the list for your state auto dealer license.
Request a Massachusetts Motor Vehicle Dealer Bond Quote
Viking Bond Service has worked with countless motor vehicle dealers from across the country. We understand your excitement and your anxiety, and we know how to make the bonding process as easy as possible. If you're ready to get started immediately, take just a few minutes to complete our online application. If you need more information first, reach out to us through the contact form on this page, or call us at 1-888-278-7389.
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