Who needs Arkansas Auto Dealer Bonds?

Auto dealers in Arkansas must obtain a surety bond as part of the licensing process. This includes used motor vehicle dealers, wholesalers, auto auctions, and new vehicle dealers.

The bond is required before your dealer license can be issued and must remain active for you to legally operate. It is part of the state’s effort to ensure dealers follow Arkansas regulations when selling vehicles.

The bond protects customers, creditors, and the state if a dealer violates licensing rules or causes financial harm through unlawful business practices. If a valid claim is paid, the dealer is responsible for repaying the surety company.

How much do Arkansas Auto Dealer Bonds cost?

Arkansas sets the required bond amount based on your dealership type:

  • Used motor vehicle dealers, wholesalers, and auto auctions require a $25,000 bond.
  • New vehicle dealers require a $50,000 bond.

You do not pay the full bond amount. Instead, you pay a small percentage called a premium. Most Arkansas auto dealer bonds cost between 1% and 3% of the required bond amount, depending on your credit, financial strength, and industry experience.

Applicants with strong credit generally receive the lowest rates. Even if your credit is less than perfect, you can still qualify for this bond, though your rate may be higher.

How do I get an Arkansas Auto Dealer Bond?

Getting your Arkansas auto dealer bond is a straightforward process.
First, complete a short bond application. The surety company will review your credit and basic background information to determine your rate. Once approved and payment is made, the bond is issued for filing with the state.

The bond is one of several requirements for obtaining your Arkansas motor vehicle dealer license. You will also need to:

  • Submit your license application to the Arkansas Department of State Police
  • Provide a photograph of your business location
  • Show proof of liability insurance
  • Submit the required State Police affidavit

Dealer licenses are valid for one year and must be renewed annually. Used auto dealers must also pay the required annual renewal fee to maintain their license.

Can I get an Arkansas Auto Dealer Bond with bad credit?

Yes. Bad credit does not automatically prevent you from getting an Arkansas auto dealer bond.

While your rate may be higher if you have credit challenges, many dealers with lower credit scores are still approved. Surety companies consider multiple factors, including experience and overall financial profile, not just your credit score.

How fast can I get Arkansas Auto Dealer Bonds?

Most Arkansas auto dealer bonds are issued quickly, often within one business day once your application is submitted and approved.

In many cases, you can receive a quote the same day. Once payment is processed, the bond can be delivered promptly so you can move forward with your licensing.

Are there any local requirements?

The bond requirement applies statewide in Arkansas. The required bond amount depends on your dealership type, but the process is the same throughout the state.

Your bond must be filed as part of your application with the Arkansas Department of State Police, and it must remain active for as long as you are licensed.

If you’re unsure which bond you need, BOSS Bonds can review your licensing paperwork and help identify the correct bond at no cost.