Not in Tennessee? Motor vehicle dealer bonds in other states

Tennessee motor vehicle dealer bonds.
$1,000 flat.

Also known as the Tennessee auto dealer bond or car dealer bond.

Tennessee requires every licensed motor vehicle dealer to maintain a $50,000 surety bond under Tenn. Code Ann. § 55-17-111. Ours is $1,000 flat — the price you see is the checkout price, identical for every dealer. One soft credit pull; the bond is issued when you pay.

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Required for your TN dealer license — new applicants and renewals through the Motor Vehicle Commission

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Fixed amount, fixed price — $50,000 bond, $1,000, no quote theater

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Soft credit pull only — a quick check that never affects your score, and the price stays $1,000 either way

A-ratedA.M. Best carriersInstantissued the moment you pay2-yr termset by the carrier

Trusted by industry leaders

How it works

Three steps to licensed.

Your dealer license is waiting on this bond. Here's the entire process — no broker phone tag:

TODAY · ONLINE

Apply once, online

Business details, owner information, the county where the dealership sits, and an effective date. The only extra step is a one-time consent to a soft credit pull.

RIGHT AWAY

Approved

Most are approved as soon as you apply. The credit check is a soft pull that never affects your score. If it needs a second look, one to two business days at most.

WHEN YOU PAY

E-sign & file with the Motor Vehicle Commission

Pay online and receive the executed bond ready to file with your dealer license application. Wet-ink originals mailed whenever the state insists.

About this bond

What it is and who needs it.

What the bond actually guarantees

Tennessee licenses motor vehicle dealers through the Motor Vehicle Commission and conditions the license on a $50,000 surety bond. The bond is a consumer-protection guarantee: it stands behind clear title on the vehicles you sell and the proper handling of a customer's prepaid title, registration, and tax money.

It's a three-party arrangement: you (the principal), the surety carrier standing behind you, and the State of Tennessee together with harmed buyers (the protected parties). If a dealer fails to deliver a clean title free of prior liens, or fails to remit a customer's prepaid fees and taxes, the harmed party can recover against the bond.

It is not insurance for you — if the surety pays a claim, you repay the surety. Dealers who deliver clean title and keep good records treat the bond as a license formality, not a risk.

Tenn. Code Ann. § 55-17-111Tennessee Code Annotated § 55-17-111 conditions a motor vehicle dealer license on a corporate surety bond of at least $50,000, in force for the benefit of any person who suffers loss from the dealer failing to deliver valid, lien-free title or failing to remit a retail customer's prepaid title, registration, fees, or taxes. The statute provides that a letter of credit is not acceptable in place of the surety bond, and the bond runs a two-year term tied to the license cycle.

You need this bond if you're

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Applying for a TN dealer license — new, used, wholesale, or other dealer class

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Renewing your dealer license and your current bond is expiring or non-renewing

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Opening an additional location the Motor Vehicle Commission ties to a bond filing

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Moving to Tennessee from another state and getting licensed here

One application, issued instantly.

These are the actual underwriting fields, including a one-time consent to a soft credit pull. Submit once and your bond is issued when you pay.

Start the application →

FAQ

Common questions.

Do I pay the $50,000?No. You pay $1,000 flat. The $50,000 is the surety's maximum liability to the state and harmed buyers; it's not a deposit, and nobody holds your money.

Who requires this bond?The Tennessee Motor Vehicle Commission requires it as a condition of a motor vehicle dealer license, under Tenn. Code Ann. § 55-17-111. No active bond, no license — and a letter of credit is not accepted in its place.

What does the bond guarantee?That you deliver clear, lien-free title on the vehicles you sell and properly remit a customer's prepaid title, registration, fees, and taxes. If you fail to and someone is harmed, they can claim against the bond — and if the surety pays, you repay the surety.

Is there a credit check?Yes — one soft credit pull, which never affects your score. It's the only extra step beyond the application, and it informs approval, not price. The price is $1,000 flat either way: credit can affect whether we approve the bond, never what it costs.

When does it renew?The statutory bond term is two years, tied to the license cycle. The carrier issues this bond for a single 2-year term with us; we send renewal notices 60 and 30 days out, with autopay available, so your license never lapses over a missed email.

Which A-rated carriers underwrite these bonds?Typically Arch Insurance Company (A.M. Best A+) or Nationwide Mutual Insurance Company (A.M. Best A). Which one writes your bond depends on the bond type and your state. The carrier's name and official signature are printed on the bond you receive.

How do I contact Light RFP about this bond?Email insurance@lightrfp.com. It reaches the bond team at Light RFP Risk Management Services LLC (NY DFS License # PC-1978982). Write to us about quotes, applications, bond forms or certificates. We will respond within 24 hours.

Same family

Other Tennessee motor vehicle dealer bonds.

Not sure this is the one your license calls for? These are the other motor vehicle dealer bonds we write in Tennessee. Each has its own statute and bond amount.

Related bonds

Other Tennessee bonds.

The Motor Vehicle Commission is waiting on one document.

$1,000 flat, short application, bond issued when you pay. Free until issued.

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Your price$1,000

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