Washington Motor Vehicle Dealer Surety Bond
A Washington motor vehicle dealer surety bond is a required license bond for any person or business engaged in buying, selling, manufacturing, distributing, auctioning, brokering, leasing, or advertising the sale of motor vehicles within the State of Washington. The Washington State Department of Licensing (DOL) requires you to post a surety bond as part of the dealer licensing process. The standard bond amount for most motor vehicle dealers is $30,000. Surety One, Inc. offers quick, no-hassle underwriting for Washington motor vehicle dealer bonds, including options for new applicants and those with challenged credit.
Bond Amount & Requirements
Revised Code of Washington RCW 46.70.070 requires motor vehicle dealer license applicants to file a surety bond with the DOL before a license will be issued. The bond amount varies by dealer classification. The bond must be executed by a surety company authorized to do business in Washington and approved by the Attorney General as to form.
The bond is conditioned upon the dealer conducting business in conformity with the provisions of RCW Chapter 46.70. Any retail purchaser, consignor (who is not a dealer), or motor vehicle dealer who has transacted business with a wholesale dealer and suffered a loss by reason of a violation of this chapter has the right to institute an action for recovery against the dealer and the surety bond.
| Bond Amount | Dealer Classification | Description |
|---|---|---|
| $30,000 | Motor Vehicle Dealer | New and/or used car, truck, and motor vehicle dealers (retail and wholesale) |
| $30,000 | Mobile Home / Park Trailer / Travel Trailer Dealer | Dealers selling mobile homes, park trailers, and travel trailers |
| $30,000 | Vehicle Auction | Businesses providing vehicle auction facilities and services |
| $40,000 | Mobile Home Manufacturer | Businesses that manufacture mobile homes in Washington |
| $20,000 | Travel Trailer Manufacturer | Businesses that manufacture travel trailers |
| $5,000 | Miscellaneous Dealer | Vessel (boat) dealers selling 15+ watercraft/year; other miscellaneous classifications |
Important — Multiple Locations: A separate bond is required for each business location in Washington, and bond coverage must extend to all temporary subagencies. If you hold more than one dealer classification, the bond amount required is the highest single bond among your classifications — you do not need to stack multiple bonds. Upon exhaustion of the bond’s penalty or cancellation by the surety, the dealer license is automatically canceled.
Who Needs This Bond?
Under RCW 46.70.011, a motor vehicle dealer is broadly defined as any person or business entity who buys, sells, manufactures, distributes, auctions, brokers, leases, or advertises the sale of motor vehicles, either directly or indirectly. You are required to obtain a dealer license and surety bond if you intend to sell more than four (4) registered vehicles per year, engage in vehicle buying and selling for profit, or sell vehicles not registered in your name.
The bond is required for:
- New (franchise) motor vehicle dealers
- Used (independent) motor vehicle dealers
- Wholesale motor vehicle dealers
- Vehicle auction operators
- Mobile home, park trailer, and travel trailer dealers
- Vehicle and mobile home manufacturers
- Vessel (boat) dealers selling 15 or more watercraft per year
- Motor vehicle wreckers and salvage dealers
How Much Does the Bond Cost?
The cost of a Washington motor vehicle dealer surety bond (the “premium”) is a small percentage of the required bond amount. Your exact premium is determined by a number of underwriting factors including your personal credit score, business financial strength, industry experience, and claims history. Because each applicant’s profile is unique, premiums vary and are quoted on an individual basis.
Surety One, Inc. offers competitive rates for all credit profiles, including programs for applicants with challenged credit. Surety bond application review and quoting are free of charge. There is no obligation to purchase. Contact us for your personalized quote.
Washington Dealer License Requirements
In addition to the surety bond, the Washington State Department of Licensing requires the following for a dealer license:
- Completed Business License Application with the Vehicle Dealer Manufacturer Addendum
- Eight-hour dealer education course (does not apply to new/franchise dealers)
- Five hours of continuing education at each annual renewal (used vehicle dealers only), from a DOL-approved provider
- Financial/Source of Funds Statement for each sole proprietor, partner, or business entity
- Personal Criminal History Statement (must pass background check)
- E-Permit obtained through the DOL E-Permit system
- An established place of business at a fixed location (not a residence)
- Permanent signage identifying the dealership
- Copy of lease, rental agreement, or tax statement for the business property
- Applicable licensing fees
Note: The business and owner name on the surety bond must match exactly with the business and owner name on the license application.
Filing, Renewal & Cancellation
The executed surety bond must be filed with the Washington State Department of Licensing. After the application and bond are submitted and fees paid, a DOL Dealer Inspector will contact you to schedule an on-site inspection of your business location. Washington dealer licenses are valid for one year from the date of issuance and must be renewed before expiration. Dealers can renew their license online through the DOL portal.
The surety or the dealer may cancel the bond with 30 days’ written notice to the DOL. Successive recoveries against the bond are permitted, but the aggregate liability of the surety to all persons shall not exceed the bond amount. Upon exhaustion of the bond penalty or cancellation of the bond by the surety, the dealer license is automatically deemed canceled.
Bond Claims
Any retail purchaser, consignor (who is not a motor vehicle dealer), or a motor vehicle dealer who has transacted business with a wholesale dealer and suffered loss or damage by reason of a violation of RCW Chapter 46.70 has the right to institute an action for recovery against the dealer and the surety bond. The aggregate liability of the surety to all persons shall not exceed the bond amount. Common claim triggers include failure to deliver title, odometer fraud, misrepresentation of vehicle condition, and nonpayment of taxes or fees.
Washington State Department of Licensing
Business Licensing Services
P.O. Box 9020
Olympia, WA 98507
Phone: (360) 902-2500
Web: dol.wa.gov
Surety One, Inc. is the Washington surety bond expert provider, licensed in all fifty states, U.S. territories, and Canada. We offer competitive rates and excellent customer service for Washington motor vehicle dealer bonds and all other license bond classes. Need help meeting your DOL licensing requirements? Call us at (800) 373-2804, email us at Underwriting@SuretyOne.com, or click here to chat with a live underwriter (no bots!) for immediate assistance. We’re here to support your business success.
Surety bond application review and quoting are free of charge. There is no obligation to purchase.
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