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Does Iowa Require a Surety Bond for Motor Vehicle Dealers?

An Iowa Motor Vehicle Dealer shakes hands with customers

If you are a Motor Vehicle Dealer in Iowa, you need to apply for a license through the Iowa Department of Transportation, Office of Vehicle Services. The definition of a retail motor vehicle dealer includes: new or used motor vehicle dealer (also known as a car dealer or auto dealer), travel trailer dealer, truck dealer, motor home dealer, motorcycle dealer, low speed vehicle dealer, and motorized bicycle dealer.

Dealers need to go through the application process which includes:

Used dealers must first complete the eight-hour pre-licensing course (prior to application).

Applicants must be able to pass a criminal background check.

Complete the dealer or travel trailer application and pay the applicable fee.

Applicants must establish a place of business and obtain zoning approval. The business must have a office with a telephone with a directory listing of the business, maintain at least 32 hours per week of business operation (motorcycle dealers do not have to meet this requirement), and have a suitable display space and a repair facility. An on-site inspection of the location must be conducted by the County Treasurer's office for your area.

Motor vehicle applicants must obtain a $75,000 surety bond (travel trailer dealers require a $25,000 surety bond).

New/Franchise dealers must provide a copy of their manufacturer or distributor franchise agreement.

Provide a copy of your liability insurance coverage. The minimum liability coverage is $100,000 bodily injury or death of one person, $300,000 bodily injury or death of two or more persons per accident, and $50,000 property damage in one accident.

How Much Will This Bond Cost?

The premium that you pay for an Iowa Motor Vehicle Dealer Surety Bond is dependent on credit, the bond amount required and experience in the motor vehicle industry.

Our Surety Bond Specialists can give you a free, no-obligation quote for the type of bond needed for your business.

Have Questions?

Contact our Surety Bond Specialists at:

Phone: 1‑844‑432‑6637
Emailinfo@suretygroup.com
Fax:     404-351-3237
Hours: 8:00-5:00 CST, Monday through Friday



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