Arizona Motor Vehicle Dealer Bonds
Arizona Motor Vehicle Dealer Bond Information
Surety bonds are required in the state of Arizona for retail dealers of new and used motor vehicles, automotive recyclers, and title service companies. The Arizona Motor Vehicle Division has established the following bond requirements:
- $100,000 surety bond for New and Used Motor Vehicle Dealers, Public Consignment Auction Dealers
- $20,000 surety bond for Automotive Recyclers
- $25,000 surety bond for Brokers, Wholesale Auction Dealers, Wholesale Motor Vehicle Dealers, and Title Service Companies
A separate surety bond is required for each application and for each county in which the licensee has an established place of business.
How Much Does a Motor Vehicle Dealer Bond Cost in Arizona?
Most Common Bonds
What does a Motor Vehicle Dealer Bond Protect Against?
Arizona motor vehicle surety bonds guarantee compliance with the rules and regulations as outlined in the Arizona Revised Statutes, Title 28 – Transportation. Specifically, the bond protects the obligee and consumers from damages arising from the following actions by the principal:
- Non-payment of tax, title, registration, or other related fees as required by law
- Failure to deliver a valid vehicle title certificate free and clear of any and all prior owner's interest and liens, the only exception being a lien created by expressly assumed in writing by the buyer of the vehicle
Getting Your Arizona Business License or Registration
The following is an overview of key Arizona motor vehicle dealer licensing requirements.
- Application completed in full and signed by an individual, all partners, or an officer of the corporation
- Provide personal history form and fingerprint card allowing for a criminal records check
- Submit a surety bond
- Pay fees including filing, criminal records, license and other applicable fees
- Submit copies of Buy/Sell Agreements
- Establish set business hours
- Meet state signage requirements
- Additional items may be needed and exact requirements may vary based on applicant, license type or obligee discretion. Please see obligee and state links in the Other Helpful Information and Links section below or contact the obligee directly for more information.
Arizona Motor Vehicle Division Business Type Definitions
New Dealers can sell new and used vehicles retail; wholesale and on consignment. They need a franchise appointment letter from the manufacturer of the make of vehicle they are selling and are required to operate from your licensed established place of business.
Used Dealers can sell used vehicles retail; wholesale and on consignment and are required to operate from the licensed established place of business.
Public Consignment Auction Dealers can sell retail or wholesale and on consignment only and only at live auction. They are required to operate from the licensed established place of business and may not buy from a wholesale dealer or the public.
Wholesale Vehicle Dealers can sell wholesale only to other licensed dealers and may not advertise or give the appearance of selling or offering to sell retail. Non-compliance may result in civil penalties of $1000 - $3000 per sale or offer to sell and loss of license. Wholesale Vehicle Dealers must title all vehicles in name of wholesale license before transferring title and may operate from a residence as the licensed principle place of business.
Wholesale Auction Dealers act as a clearing house for dealer to dealer sales solely in wholesale transactions to licensed motor vehicle dealers and do not buy, sell or own the vehicles auctioned in the ordinary course of business.
Brokers act as a locator service to find a specific vehicle for customers and provide a service of arranging or assisting in effecting the purchase of a motor vehicle. Brokers may not advertise for sale of exchange any specific motor vehicle or be an employee or agent of a new, used, auctioneer, manufacturer or a wholesale dealer Manufacturer/Distributor. Brokers can franchise licensed dealers to sell products but may not sell direct to the consumer
Auto Recyclers can buy vehicles for the purpose of dismantling and selling the parts and accessories.
Other Helpful Information and Links
Arizona motor vehicle dealer surety bonds are continuous and require 60 days prior written notice to the Arizona Motor Vehicle Division in order to effect cancelation.
Arizona Motor Vehicle Division Contact Information - Arizona Motor Vehicle Division, Dealer Licensing Unit- Mail Drop 552M, P.O. Box 2100, Phoenix, AZ 85001-2100, www.azdot.gov