New Hampshire Auto Dealer Bonds
Surety Bond Professionals is a family owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with all of your New Hampshire auto dealer bond needs.
What Are They?
A New Hampshire auto dealer bond protects both the state and the public against financial harm resulting from a licensed dealer’s malfeasance. The bond mandates a high level of ethical conduct by requiring a bonded dealer to operate in full compliance with the laws and regulations governing auto sales within the state. It also provides a way to compensate those with valid claims for damages.
Who Needs Them?
The New Hampshire Department of Safety, Division of Motor Vehicles issues motor vehicle dealer licenses in three major categories: retail (for dealers selling new and/or used vehicles to the public), wholesaler (for dealers selling vehicles only to other licensed dealers), and motorcycle (for dealers selling only motorcycles on a retail basis). Every applicant for licensure must purchase a $25,000 New Hampshire auto dealer bond and renew it at every expiration date or risk license revocation.
Speak with a Surety Bond Professionals agent today to discuss your bonding needs.
How Do They Work?
Every New Hampshire auto dealer bond is a legally binding contract that brings together three parties known in the lingo of surety bonds as the “obligee,” the “principal,” and the “surety.”
- The Department of Safety is the obligee for all New Hampshire auto dealer bonds.
- The dealer is the principal, who bears the full legal responsibility for paying a valid claim for damages.
- The bond’s guarantor is known as the surety.
The most common reason for the obligee to file a claim against a New Hampshire auto dealer bond is the principal’s failure to remit taxes owed to the state. There are many reasons for a consumer to file a claim, such as the principal’s falsification of an odometer reading, fraudulent alteration of a title, or misrepresentation of a vehicle’s condition. It’s up to the surety to determine which claims are valid and need to be paid.
It’s rare for the principal to pay the claimant directly. The normal practice is for the surety, as the bond’s guarantor, to pay claims initially and be repaid by the principal for the resulting debt. Not repaying the surety for a claim paid on the principal’s behalf may ultimately result in the surety taking legal action to recover the amount of a claim, plus court costs and legal fees.
What Do They Cost?
How much you will pay as the annual premium for a New Hampshire auto dealer bond is determined by the premium rate the surety assigns you. That will depend to a large extent on your personal credit score, which is a measure of how responsible you have been in the past about paying bills and managing credit. The higher your credit score, the lower the risk to the surety, and the lower your premium rate, potentially less than 1%. Someone with a low credit score will be perceived as a greater risk and will pay a higher premium rate. Possibly 2-3% or more.
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Our surety bond professionals will get you the New Hampshire auto dealer bond you need at a competitive rate.