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New York Increases Surety Bond Amount for the State's Used-Vehicle Dealers

Under the new law, used-car dealers who sold fewer than 50 cars in the previous calendar year will be required to purchase a $20,000 surety bond. Dealers who sold more than 50 cars will be required to purchase a $100,000 bond. Additionally, new dealer license applicants will need to post the $20,000 surety bond.

by Staff
October 11, 2016
1 min to read


NEW YORK — On Sept. 29, Governor Andrew Cuomo signed into law a piece of legislation that will increase the surety bond amounts required for used-vehicle dealers to become licensed. The new requirement will take effect on March 28, 2017.

“The previous bond amount was insufficient to protect consumers,” said Josh Kayser, CEO of SuretyBonds.com. “There’s a certain level of trust customers place in car dealers, and these bonds make it that much easier for dealers to maintain that trust.”

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Currently, applicants and used motor vehicle dealers who sold fewer than 200 cars in the previous calendar year only needed a $10,000 bond. Dealers who sold more than 200 vehicles needed a $25,000 bond to become licensed.

Under the new law, used-car dealers who sold fewer than 50 cars in the previous calendar year will be required to purchase a $20,000 surety bond. Dealers who sold more than 50 cars will be required to purchase a $100,000 bond. Additionally, new dealer license applicants will need to post the $20,000 surety bond.

Dealers bonded under current law will be required to comply with the new surety bond requirements with renewal, replacement, alteration or extension of their bond. The state’s Department of Motor Vehicles has not determined if a new surety bond form will be issued, according to Kayser.

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