Vermont Motor Vehicle Dealer Surety Bond
A Vermont motor vehicle dealer surety bond is a required bond for any person, partnership, or corporation engaged in the business of buying, selling, or exchanging new or used motor vehicles within the State of Vermont. The Vermont Agency of Transportation, Department of Motor Vehicles (DMV) requires all dealer certificate applicants to provide a surety bond (or letter of credit or certificate of deposit). Vermont uses a volume-based three-tier bond schedule ranging from $20,000 to $35,000. Surety One, Inc. offers quick, no-hassle underwriting for all Vermont motor vehicle dealer bonds.
Bond Amount & Requirements
Vermont Statutes Annotated 23 V.S.A. §453 (Title 23, Chapter 7) requires all motor vehicle dealer certificate applicants to file a surety bond in an amount set by the Commissioner of Motor Vehicles, based on the dealer’s prior-year sales volume (or previous two years for 2-year registrations).
| Bond Amount | Prior-Year Sales Volume | Description |
|---|---|---|
| $20,000 | Fewer than 25 vehicles | Low-volume dealers |
| $25,000 | 25 – 100 vehicles | Mid-volume dealers |
| $35,000 | More than 100 vehicles | High-volume dealers |
| $35,000 | New applicants (no sales history) | Default for first-time applicants |
Important — “Dealer Certificate” & Alternatives to Bond: Vermont issues “dealer certificates” rather than “dealer licenses” — a unique terminology distinction. In lieu of a surety bond, Vermont also accepts a letter of credit or certificate of deposit in the same amount. New applicants with no sales history default to the highest tier ($35,000). The Commissioner has authority to renew certificates on a 2-year basis or stagger expiration dates. Dealerships must be open a minimum of 146 days per year. Unsatisfied judgments violating consumer protection laws will disqualify an applicant.
Who Needs This Bond?
Vermont requires a dealer certificate for anyone who sells five (5) or more motor vehicles per year. Vermont’s definition includes dealers of new and used motor vehicles, snowmobiles, motorboats, and all-terrain vehicles. Finance and auction dealers and transporters are excluded. The bond applies to:
- New (franchise) motor vehicle dealers
- Used motor vehicle dealers
- Snowmobile dealers
- Motorboat dealers
- ATV dealers
How Much Does the Bond Cost?
The cost is a small percentage of the required bond amount, determined by credit, financials, and experience. Surety One, Inc. offers competitive rates for all credit profiles. Quoting is free of charge with no obligation to purchase.
Vermont Dealer Certificate Requirements
- Completed Dealer Registration application
- Surety bond (or continual surety bond), letter of credit, or certificate of deposit in the required amount
- Permanent building of at least 1,200 square feet with room for record storage (not required for snowmobile, ATV, or boat dealers)
- Lease or deed for the business property
- Dealership open a minimum of 146 days per year with hours noted on the application
- Criminal background check — applicants must not have prior dealer law violations or unsatisfied consumer protection judgments
- Credit report
- Valid sales tax license
- Dealer plate liability insurance on all vehicles with dealer plates
- Franchise agreement or manufacturer authorization (new vehicle dealers)
Filing, Renewal & Cancellation
The dealer certificate is valid for one year from the first day of the month of issuance. The Commissioner may renew certificates on a 2-year basis or stagger expiration dates at their discretion. The bond may be issued as a standard annual bond or as a continual bond. Premium is payable annually regardless of bond type. A dealer certificate may be suspended if the bond is canceled and not replaced.
Bond Claims
The bond ensures compliance with all state laws governing motor vehicle sales and remittance of required taxes and fees. The aggregate liability of the surety cannot exceed the bond’s penal sum during any single registration period. Claims are filed directly with the surety company.
Vermont Agency of Transportation
Department of Motor Vehicles
120 State Street
Montpelier, VT 05603-0001
Phone: (802) 828-2000 / (802) 828-2038
Web: dmv.vermont.gov
Surety One, Inc. is the Vermont surety bond expert provider, licensed in all fifty states, U.S. territories, and Canada. We offer competitive rates for Vermont motor vehicle dealer bonds at every volume tier and all other license bond classes. Call us at (800) 373-2804, email Underwriting@SuretyOne.com, or chat with a live underwriter for immediate assistance.
Surety bond application review and quoting are free of charge. There is no obligation to purchase.
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