Motor Vehicle Dealers - New or New and Used Vehicles

The State of Kansas Vehicle Dealer Bond is a surety bond required for businesses engaged in selling new or used motor vehicles in Kansas. This bond ensures that vehicle dealers comply with state laws and regulations governing motor vehicle sales and protects consumers from fraudulent or unethical business practices.

Who Needs This Bond: All motor vehicle dealers operating in Kansas, including new vehicle dealers (often franchised dealers) and used vehicle dealers, must obtain this bond as part of their licensing requirements. The bond is mandatory for maintaining a valid dealer license in the state.

Protection and Coverage: The bond protects the State of Kansas and consumers who purchase vehicles from licensed dealers. It provides financial recourse if a dealer violates state regulations, engages in fraudulent practices, or fails to fulfill contractual obligations to customers. The bond ensures that affected parties can recover damages up to the bond amount.

Bond Details: The bond amount is $50,000 with a one-year term and is renewable annually. Dealers can add supplemental locations to their existing bond through an endorsement, provided they operate under the same license and dealer number. The underwriting requirements vary based on dealer type, with new/franchised dealers typically requiring an application and clean credit history, while used dealers may need additional documentation including financial statements.