Making bond is a good deal in case of any property transferring or owning. There are many types of bond available like vehicle bond, house rental bond, house sale bond, land owning or selling bond, etc. Likewise auto dealer bond is also a type of bond in which the individuals who are looking forward to obtain a motor vehicle dealer license should prepare an auto dealer bond and should submit it to the concerned authorities as a financial guarantee. The auto dealer bond differs with each state and territory.
The auto dealer bond is also termed as motor vehicle dealer or surety bond which acts mainly as a protection deal for the consumer from unlawful activities, fraud, etc by the dealers and the other employees.
The cost of making the auto dealer bond depends on several factors. Generally the surety bond ensuring companies use point grade system for rating the vehicle and the dealer and thereby calculate the price of the premiums. For this process the personal savings, credits and debits of the dealer will be checked readily. Some of the factors with which the premium amount may get hike are as follows:
- The total number of the credit inquiries
- The revolving debt, and
- Revolving debt’s usage percentage level
Once these above mentioned information were collected, then it will be entered into the main database to calculate the premium amount to be charged for making the dealer bond.
Always try to do business only with the authorized, licensed and recognized dealers for buying as well as selling the vehicles, because fake dealers always have problems around them which may disturb your truthfulness. At the same time trust only the true dealers for your vehicle business which develops good mane and fame provided with unique dealer bond.
You should be more careful mainly when you are going to buy a second hand used motor vehicle. Only the vehicle dealer knows the real history and condition of the particular vehicle. If the dealer is not having perfect license and not having any auto dealer bond then you have to suffer throughout your life.