Posting of a Tennessee motor vehicle dealer bond is one of fifteen legal requirements for obtaining a license to operate a “dealership” in the state. Pursuant to law, a “motor vehicle dealer” means any person engaged in the business of selling, offering to sell, soliciting or advertising the sale of motor vehicles or recreational vehicles, or possessing motor vehicles or recreational vehicles for the purpose of resale, either on that person’s own account or on behalf of another, either as that person’s primary business or incidental to that person’s business (55-17-102 (16)). The Tennessee motor vehicle dealer bond is required of each application for a license or renewal and must be written in the amount of at least fifty thousand dollars ($50,000). Where it is permitted in some states, in Tennessee a letter of credit is not allowed in lieu of a surety bond.  The surety bond must be written is for the benefit of any person who suffers loss because of either nonpayment by the dealer of a retail customer’s prepaid title, registration or other related fees or taxes, or the dealer’s failure to deliver a valid vehicle certificate of title clear of any prior owner’s interests and all liens except perhaps a lien created by or expressly assumed in writing by the buyer of the vehicle.  The Tennessee motor vehicle dealer bond aslo serves as a compliance obligation, guaranteeing that the dealer will not violate the provisions of Chapter 321 Public Acts of 1993.  The surety bond is not cumulative, being limited only to the penal sum of the bond and may be canceled by surety by certified mail notice to both the Obligee and the principal. Tennessee surety leaderSurety One, Inc. offers motor vehicle dealer bonds in all states where they are required by law.  Our special programs allow us to offer you surety support regardless of your credit and financial condition. Visit us at, call (787) 333-0222 or (800) 373-2804, or email us at for a Tennessee motor vehicle dealer bond application or for information on any surety bond need.