What is a Used Car Dealer Bond?
A used car dealer bond is a type of insurance that dealers must obtain before opening their business. The used car dealer bond protects customers against fraudulent or unethical actions by a dealer. The surety bond also assures the dealer is financially secure. In cases where a customer is cheated by a dealer, the surety bond will reimburse that customer.
Before dealers purchase a bond from an agency, they must submit themselves to a credit check, have their application approved, and go through other screening processes.