Apply for a Minnesota Surety Bond today! Absolute Surety is a leading MN surety bond company. Apply easily online and take advantage of lowest rates. Quickly browse the bonds we offer in this state, or contact us for a full list.
In Minnesota, if you sell more than five motor vehicles a year, you must become licensed as an auto dealer. And in order to become licensed as an auto dealer, you must purchase a Minnesota auto dealer bond. This is a type of license and permit bond that protects the state and consumers against losing money due to your violation of state laws. The bond must be submitted along with your application for a new or renewal license.
Bond Penalty Amount: $50,000 (new & used)
Bond Term: 1 year
Bond Expiration Date: Varies
Who Needs Them?
Minnesota distinguishes between dealers who sell new and/or used cars and those who sell boats, snowmobiles, horse trailers, or motor bikes. Our focus here is on auto dealer bonds. If you are seeking a license as an auto dealer in Minnesota, continue reading to learn more about the bonding requirements you must meet.
This bond is required by the State of Minnesota Department of Public Safety, Driver and Vehicle Services, for the following license types:
New Vehicle Dealer
Used Vehicle Dealer
In order to maintain your dealer license with the State of Minnesota you must keep your surety bond in good standing.
How Do They Work?
All surety bond contracts involve three parties: the obligee, the principal, and the surety. In the case of a Minnesota dealer bond, the following parties are involved:
The Minnesota Department of Public Safety, Driver and Vehicle Services is the obligee, the party requiring the bond.
The auto dealer is the principal purchasing the bond.
The surety is the company issuing the bond to a given individual.
The state has established a required bond amount (also known as the penal amount) of $50,000. Anyone who suffers a financial loss as the result of the principal’s unlawful actions may file a claim against the bond up to that required bond amount. After investigating to ensure that a claim is valid, the surety will make payment to the claimant, as a matter of expedience. However, the bond contract’s indemnity clause lays the responsibility for paying claims on the shoulders of the principal, who must reimburse the surety for the full amount paid to the claimant.
What Do They Cost?
The premium you will pay for the bond is only a small percentage of the total required bond amount. You can expect to pay anywhere between .75% to 5% of the bond penalty amount ($375 to $2,500) if you maintain good credit. Applicants with credit issues (e.g., bankruptcies, civil judgments, tax liens, etc.) may pay a higher premium.
After You Purchase Your Bond
After you receive your vehicle dealer bond from Absolute Surety, you will need to file it along with the attached power of attorney with:
Minnesota Department of Public Safety
Dealer and Vehicle Services
445 Minnesota St
St Paul, MN 55101
When you work with Absolute Surety, you can rely on our experienced professionals to get you the best possible rate on your Minnesota auto dealer bond.