Motor Vehicle Dealers - New or New and Used Vehicles

The Motor Vehicle Dealer Continual Bond is a surety bond required by the State of Vermont for businesses engaged in selling new or new and used motor vehicles. This bond serves as a financial guarantee that dealers will comply with state regulations and conduct business in accordance with Vermont motor vehicle dealer laws.

Who Needs This Bond: All motor vehicle dealers operating in Vermont who sell new vehicles or both new and used vehicles must obtain this bond to secure and maintain their dealer license. The bond is mandatory for license issuance and ongoing compliance.

Bond Protection: This bond protects the State of Vermont and consumers from financial losses resulting from a dealer's violation of state motor vehicle laws, fraudulent practices, or failure to fulfill contractual obligations. If a dealer engages in prohibited activities or fails to meet legal requirements, claims can be filed against the bond to compensate affected parties.

Coverage Details: Bond amounts are determined by the dealer's sales volume from the previous year: new dealer applicants require $35,000; dealers selling fewer than 25 vehicles need $20,000; those selling 25-100 vehicles need $25,000; dealers selling 101-250 vehicles require $30,000; and those selling 251 or more vehicles need $35,000. The bond has a one-year term and is renewable annually to maintain continuous coverage and license validity.