A South Carolina Motor Vehicle Division (MVD) Bond is a type of surety bond required for any individual or business that wishes to obtain a license or permit to operate in the state. The bond guarantees that the licensee will comply with all applicable laws and regulations and will pay any fines or penalties that may be imposed. The bond serves as a financial guarantee to the state that the licensee will fulfill its obligations. The bond amount is determined by the South Carolina Department of Motor Vehicles (SCDMV). The bond must be purchased from a surety company licensed in South Carolina and must be renewed each year. The bond is in place to protect the public and the state of South Carolina from any losses caused by the licensee's non-compliance.
What is an South Carolina Car Dealer Bond?
South Carolina Car Dealer Bonds are required by the People of the State to obtain your Dealer license. The MVD Bond amount for the sale of New and used vehicles is set at $30,000. The Auto Dealer bond ensures that the principal shall comply with the conditions of any contract made by such licensee in connection with the sale or exchange of any motor vehicle and shall not violate any of the provisions of law relating to the conduct of the business for which it is licensed.
The State requires a Car Dealer bond for each license you hold:
$30,000 surety bond for New and Used Motor Vehicle Dealers, Public Consignment Auction Dealers and any other types of dealer
$15,000 surety bond for Wholesale Auto Auction. Motorcycle Dealers, and Motorcycle Wholesalers
Different parts of a bond:
There are 3 parts to a MVD surety bond. The Principal "YOU", The Surety Company, and the Obligee. The Principal is the business or individual applying for the MVD Surety Bond. The Obligee is the individual or entity requiring the Surety Bond and the Surety Company is the company who provides the Surety Bond coverage.
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South Carolina MVD Bond Information and Requirements:
Theensures that every dealer or wholesaler applicant furnishes a surety bond in the amount required by South Carolina law.
You must submit your original Surety Bond and Power of Attorney with yourat the time of your application. The bond provides security or protection against loss or damage due to fraud or fraudulent representation in relation to a sale or transfer of a motor vehicle by a licensed dealer, wholesaler, or their employees.
Your bond must be in effect before the SCDMV will grant you a license. The owner, partner, or corporate officer of the dealership must sign the surety bond. A corporate surety company authorized to do business in SC must secure the bond. You must submit a new surety bond and Power of Attorney to the SCDMV if you change your bonding company. Dealers should always keep a copy of all documents submitted to this agency.