Louisiana Used Car Dealer Surety Bond
Louisiana Used Car Dealers are required to have a license and secure a surety bond in order to operate in the state. Dealers that are required to have a surety bond for licensure include used dealers, daily rental dealers, rent to purchase dealers, and vehicle auction dealers. The surety bond ensures compliance of state laws and honest and ethical business practices.
Surety Bond and License Requirements:
- Dealer applicants can obtain a Louisiana Used Dealer License Packet from the Louisiana Used Motor Vehicle Commission (also known as the LUMVC).
- Applicants must complete the application and pay the license fee and if applicable a criminal background check fee.
- Complete the dealer training seminar.
- Dealers must have a business location that includes a sign visible from the street (minimum 4' x 4') that has the exact business trade name, have a landline business phone line, and meet local authority zoning requirements. An inspection of the premises will be conducted prior to the issuance of a license.
- Obtain a surety bond based on the number of vehicles sold or anticipated to be sold:
$20,000 surety bond if 119 units or less are sold in a 12-month period
$35,000 surety bond if 120 units or more are sold in a 12-month period
Vehicles sold are defined as: Used Cars, Trucks, Auto Dealers, Used Boat and Boat Motor Dealers, Used Trailer Dealers, Used Motorcycle Dealers, Used Motorhome Dealers, Used Vehicle Brokers, Used ATV or Off Road Dealers, Used Buses, Firetrucks, or Wrecker Dealers, Auction Dealers (public, wholesale, or salvage), Daily Rental Used Vehicle Dealers, Dealers That Rent With The Option to Purchase.
- Applicants must obtain garage liability insurance coverage with minimum limits of $55,000. Dealers that offer rent with the option to purchase must have minimum liability coverage of $100,000/$300,000/$50,000 and daily rental dealers must have a minimum of $15,000/$30,000/$25,000 coverage.
- Dealers that offer rent to purchase vehicles will need to provide a copy of their rental purchase agreement.
- Licenses and surety bonds must be renewed every two years by December 31.
How Much Will This Bond Cost?
The premium that you pay for a Louisiana Used Vehicle Dealer Surety Bond is dependent on credit, bond amount required and experience in vehicle sales industry. Our rates start at 1.25% of the bond amount with good credit. Contact our Surety Bond Specialists for a free quote.
Related Links:Louisiana Used Motor Vehicle Commission
More Surety Bond Questions?
Check out our FAQ page or What’s a Surety Bond? page. Should you need or choose to buy a surety bond, call us first. SuretyGroup.com has been underwriting surety bonds throughout the U.S. for more than 35 years. When you work with us, you enjoy the unique benefit of dealing with a team of highly experienced surety agents with in-house underwriting authority. This allows you to receive competitive, low rates, quick approvals, and immediate bond delivery. In most cases, your bond will be delivered within 24 hours after you apply for it.
For a downloadable application