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MMBONDING
California DMV

California Motor Vehicle Dealer Bond

California auto dealers file a $50,000 motor vehicle dealer bond with the DMV to get or keep a dealer license. Motorcycle, ATV, and small wholesale dealers file $10,000 instead. We place both, including for newer dealers and tougher credit.

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Key facts
Bond amount
$50,000
Authority
California DMV
Statute
Veh. Code §11710

The premium is a percentage of the bond amount, set by underwriting. The figures above are the bond amounts, not what you pay.

Illustration for the California Motor Vehicle Dealer Bond

What it is

The motor vehicle dealer bond guarantees you operate within California's vehicle code and pay what you owe, protecting customers and the state. Veh. Code §11710 sets it at $50,000 on form OL 25 for retail dealers, and at $10,000 on form OL 25 B for dealers handling only motorcycles or all-terrain vehicles, and for wholesale-only dealers under 25 vehicles a year.

Who needs it

  • Retail used and new car dealers licensed by the DMV
  • Dealers renewing an existing license
  • Operators the DMV requires to bond before licensing

Bond amounts and requirements are general guidance and can change. Confirm the current requirement with the listed agency before you file. We will quote your exact bond.

Tough credit or a prior claim? It's welcome here. See how we place hard-to-place surety bonds, or get a quote and we'll place your exact bond.

Questions

Auto Dealer Bond FAQs

How much does a $50,000 dealer bond cost?
You pay a premium that is a percentage of the $50,000, set by underwriting and driven mostly by personal credit. Strong credit pays the least. We shop several markets on one application rather than returning a single program's number, which matters most on the files a direct-issue site declines.
Do wholesale-only dealers need the same bond?
Not always. A wholesale-only dealer moving fewer than 25 vehicles a year files $10,000 on form OL 25 B rather than $50,000 on OL 25. At or above that volume, the full $50,000 applies. Confirm your license class with the DMV, then we place the matching bond.
Who files the $10,000 dealer bond instead?
Dealers handling only motorcycles or all-terrain vehicles, and wholesale-only dealers under 25 vehicles a year. It is form OL 25 B. Most pages quote only $50,000, which is why motorcycle dealers often budget five times what they actually need.
What form is the California dealer bond written on?
Form OL 25, the DMV's Dealer Surety Bond, for retail and higher-volume wholesale dealers. Form OL 25 B covers the $10,000 tier. The DMV will not accept a surety's generic bond form in place of its own, so the form matters as much as the amount.
Does the CARS Act change my dealer bond?
No. SB 766, the Combating Auto Retail Scams (CARS) Act, takes effect October 1, 2026 and is a significant change to California vehicle sales practices, but the bond requirement under Veh. Code §11710 is unchanged: same amounts, same forms. Budget for compliance work, not for a different bond.
Can a new dealer with limited credit get bonded?
Often, yes. Newer dealers and credit-challenged files are exactly what we shop across markets rather than declining on the first obstacle. Expect a higher rate rather than a refusal. Underwriting still applies and we never promise approval.
What does the dealer bond protect against?
Customers and the state, not you. A buyer harmed by fraud, an unpaid sales tax obligation, or a failure to deliver title can claim against it. If the surety pays a valid claim it recovers from you under your indemnity agreement, so a claim is a debt rather than a covered loss.
How long does the dealer bond last?
It is a continuous bond that stays in force while your license is active and the premium is paid. There is no separate expiry to track, but a canceled or lapsed bond puts the license at risk immediately, because the DMV treats the bond as a condition of licensure.
How fast can I get a dealer bond?
Often the same business day on a clean file, because the amount is fixed and no financial statements are needed. Tougher credit takes longer only because we are shopping it. Tell us your DMV deadline and we will tell you honestly whether it is reachable.
Can the DMV ask for more than the standard bond amount?
The statutory amounts under Veh. Code §11710 are the baseline. Where a dealer has an enforcement history, the DMV can impose additional conditions on licensure, which is a matter to confirm with the DMV for your specific file rather than something we can predict from the outside.
What happens to my bond if I sell the dealership?
It does not transfer. The bond runs with your license and your indemnity, so the buyer files their own bond under their own license. You stay responsible for claims arising from conduct while your bond was in force, even after the sale closes.
Do I need a dealer bond for an auction license?
License classes differ and the DMV sets the requirement per class, so confirm yours with the DMV before you buy a bond. Tell us the class on the application and we will place the bond that matches it rather than guessing at the amount.
Is the dealer bond the same as garage liability insurance?
No. The bond guarantees your compliance and pays third parties, and you reimburse the surety. Garage liability is insurance that protects your own business against covered losses. The DMV requires the bond; your lender or landlord usually requires the insurance.

Doing this for the first time? This page covers the bond. For the rest of the process, read how to get a California dealer license.

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