Delaware Auto Dealer Bonds
Auto dealer bonds protect consumers and the state. The bond amount and license type required depend on your state's DMV.
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At a glance
Delaware Auto Dealer Bond Key Facts
The basics
What Is an Auto Dealer Bond in Delaware?
A Delaware auto dealer bond is a $25,000 surety bond — but most Delaware dealers do not need one. The Division of Motor Vehicles (DMV) does not require a surety bond to hold a standard motor vehicle dealer license. A $25,000 bond is required only if you self-finance retail sales without charging interest, or if you need a Motor Vehicle Sales Finance license to finance sales with interest.
Good to know - Delaware does not require a surety bond for a standard motor vehicle dealer license from the DMV. A $25,000 bond is required only in two narrow cases: (1) you self-finance retail sales without charging the buyer interest (filed with the Department of Finance), or (2) you need a Motor Vehicle Sales Finance license to finance sales with interest (a separate $25,000 bond filed with the State Bank Commissioner). If neither applies to you, you need no dealer bond.
A surety bond is a three-party promise. You (the dealer) buy it, the surety company backs it, and it protects the public. If a bond applies to you, a buyer harmed by a wrongful act, fraud, or misrepresentation can file a claim against it, up to $25,000.
Because Delaware ties the bond to how you sell and finance vehicles — not to the license itself — the first real step is figuring out whether you need a bond at all. If you take cash or arrange financing through a lender, you likely need no bond. If you let retail buyers pay you over time, the bond rules come into play.
A bond protects your customers, not you. If a claim is paid, you must repay the surety company. The bond is separate from your state license and plate fees.
Qualification
What You Need to Qualify for a Delaware Auto Dealer Bond
Approval depends on your dealer license type, required coverage amount, and underwriting factors such as credit.
- You are applying for, or renewing, a Delaware motor vehicle dealer license through the Division of Motor Vehicles (DMV) Dealer Services.
- You know whether a bond even applies to you: most dealers need no surety bond, but you do if you self-finance retail sales without charging interest, or if you need a Motor Vehicle Sales Finance license.
- You have an established place of business in Delaware that you own, rent, or lease, and that meets all local zoning requirements.
- You hold a valid Delaware Division of Revenue business license for the dealership.
- Franchised new vehicle dealers have a copy of the franchise (or manufacturer-dealer) agreement ready for the DMV.
- If a bond applies, it is written by a surety company authorized to do business in Delaware, in the amount of $25,000.
Step by step
How to Get an Auto Dealer Bond in Delaware: Step by Step
Check whether you even need a bond
Most Delaware dealers do not. You need a $25,000 bond only if you self-finance retail sales without charging interest, or you need a Motor Vehicle Sales Finance license to finance sales with interest. If you take cash or use outside lenders, you likely need no dealer bond.
Set up your established place of business
Delaware will not license a dealer without an established place of business that you own, rent, or lease, and that meets all local zoning requirements. Have your lease or deed and zoning approval ready.
Get your Delaware business license
Obtain a Delaware Division of Revenue business license for the dealership. Every Delaware dealer must hold a valid business license in addition to the DMV dealer license.
Delaware Division of Revenue — Business LicenseApply for your DMV dealer license
Apply through DMV Dealer Services using the Dealer’s Portal. The DMV reviews your application, place of business, and good character before approving your dealer license. Email DOTDealerLicensing@Delaware.gov for the current application package.
Delaware Dealer License Application (Dealer’s Portal)Get your bond — only if it applies
If your business triggers the $25,000 bond (you self-finance retail sales without interest, or you need a sales-finance license), buy your bond and we issue it for you. We provide the original and, where accepted, file it with the correct office. There is no bond form for you to download or complete.
Renew and keep coverage continuous
Dealer plates expire December 31 and renew within 90 days before expiration. If a bond applies, its term must run with your license period and stay continuous — a lapse can put your license at risk.
Paperwork
Delaware Dealer Bond Forms & Documents
Official guide to Delaware dealer laws, requirements, and the application process.
View formWhere you start and submit your DMV dealer license application.
View formRequired business license for the dealership, separate from the DMV license.
View formRequired only if you self-finance retail sales without charging interest (Del. Code tit. 30, ch. 30). We issue this bond for you — you do not complete it.
The $25,000 bond for a Motor Vehicle Sales Finance license, filed with the State Bank Commissioner. We issue this bond for you — you do not complete it.
View formYou'll also need
Cost
How Delaware Auto Dealer Bond Pricing Works
For most Delaware dealers, the bond cost is zero — no surety bond is required for a standard dealer license, so there is no premium to pay.
If a bond does apply, you do not pay the full $25,000. That figure is the coverage — the most a claim can collect. You pay a premium, which is a small percentage of $25,000.
Your premium is set by underwriting, mostly your personal credit. Well-qualified applicants pay a low rate; higher-risk applicants pay more. Any premium is separate from your state license and plate fees.
Worked example
If your business triggers Delaware’s $25,000 bond — for example, you let retail buyers pay you over time with no interest — you would not pay $25,000. You pay a premium, a small percentage of that amount based mainly on your credit. Many Delaware dealers need no bond at all and pay nothing for one.
Filing
Filing Information
Delaware Division of Motor Vehicles (DMV) — Dealer Services
Filing notes
Most Delaware dealers file no surety bond. The DMV does not require one for a standard motor vehicle dealer license.
If you self-finance retail sales without charging interest (and are not bonded under the motor vehicle sales finance law), file a $25,000 surety bond, payable to the State, with the Delaware Department of Finance before your annual license is issued.
If you finance sales with interest, you need a Motor Vehicle Sales Finance license from the Office of the State Bank Commissioner, which requires its own $25,000 surety bond.
Where a bond is required, its term must run with your license period and coverage must stay continuous — a surety cannot cancel without at least 30 days’ written notice to the State.
When a bond applies, we issue it and provide the original (and, where accepted, file it with the right office) so you can complete your license.
FAQ
Delaware Auto Dealer Bond FAQ
Usually no. The Delaware DMV does not require a surety bond to hold a standard motor vehicle dealer license. A $25,000 bond is required only if you self-finance retail sales without charging interest, or if you need a Motor Vehicle Sales Finance license to finance sales with interest.
A dealer who self-finances retail vehicle sales without charging the buyer interest — and who is not already bonded under the motor vehicle sales finance law — must file a $25,000 bond with the Delaware Department of Finance before getting an annual license (Del. Code tit. 30, ch. 30).
Then you likely need a Motor Vehicle Sales Finance license from the Office of the State Bank Commissioner. That license requires its own $25,000 surety bond, filed with the Commissioner (Del. Code tit. 5, ch. 29).
When a bond is required, the amount is $25,000. You do not pay $25,000 — you pay a premium, a small percentage of that coverage based mainly on your credit. Most dealers need no bond and pay nothing for one.
The self-financing dealer bond is filed with the Delaware Department of Finance; the sales-finance license bond is filed with the State Bank Commissioner. When a bond applies, we issue it and, where accepted, file it with the correct office for you.
Apply through DMV Dealer Services using the Dealer’s Portal. You need an established place of business that meets local zoning, a Delaware Division of Revenue business license, and (for franchised new dealers) a franchise agreement. Email DOTDealerLicensing@Delaware.gov for the application package.
When a bond is required, its term must run with your license period and coverage must stay continuous. A surety cannot cancel without giving the State at least 30 days’ written notice, so renew before it lapses.
No. The Delaware DMV charges no fee for the dealer license itself. Dealer plates are $10 each and expire December 31. You also need a Delaware Division of Revenue business license, which is separate.
Sources
Last verified 2026-06-30. Requirements change - confirm current details with Delaware Division of Motor Vehicles (DMV) — Dealer Services before you file. This page is informational and not legal advice.
FAQ
Delaware Auto Dealer Bond Questions
The cost of a Delaware auto dealer bond is usually a small percentage of the state-required bond amount. Your exact premium depends on the bond amount, license type, business details, and underwriting factors such as credit.
Many auto dealer bonds can be issued the same day after you complete the application. Larger bond amounts or applications that need underwriting review may take longer.
Requirements vary by license type, but most Delaware auto dealers need to complete a short application and purchase the bond amount required by the state before their license can be issued or renewed.
Often, yes. Many states have separate bond requirements for wholesale, retail, broker, or other dealer license types. Choose the bond that matches your Delaware license instructions.
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AutoDealersBond.com is operated by Shield Liability Insurance Agency, a California and Texas licensed insurance agency (CA License #6018195, TX License #3446536). Shield Liability Insurance Agency is not an insurance carrier and does not underwrite bonds or insurance policies. Bond and coverage availability, pricing, and issuance are subject to carrier underwriting approval, eligibility, applicable state requirements, and policy or bond terms. Availability varies by state.
