State of South Carolina (DMV) - Motor Vehicle Dealer And Wholesaler Surety Bond
Required for motor vehicle dealers and wholesalers operating in South Carolina. Protects consumers from fraudulent practices and ensures compliance with state regulations.
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About This Bond
The South Carolina Motor Vehicle Dealer and Wholesaler Surety Bond is a financial guarantee required by the South Carolina Department of Motor Vehicles for businesses engaged in buying, selling, or dealing in motor vehicles. This bond serves as protection for the People of the State of South Carolina against potential violations of state motor vehicle laws and regulations.
Motor vehicle dealers and wholesalers operating in South Carolina must obtain this bond as part of their licensing requirements. This includes used car dealers, automotive wholesalers, and other businesses involved in the retail or wholesale distribution of motor vehicles within the state.
The bond protects consumers and the state from financial losses that may result from the dealer's failure to comply with South Carolina motor vehicle laws, fraudulent business practices, or failure to pay required fees and taxes. If a bonded dealer violates state regulations or engages in dishonest practices, affected parties can file claims against the bond for compensation.
Bond amounts vary based on the type and scope of the dealer's operations, with coverage levels of $15,000, $25,000, or $50,000. The bond term is one year and must be renewed annually to maintain active dealer licensing status in South Carolina.
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At a glance
South Carolina Auto Dealer Bond Key Facts
Governed by S.C. Code § 56-15-320.
The basics
What Is an Auto Dealer Bond in South Carolina?
A South Carolina auto dealer bond — officially the Motor Vehicle Dealer and Wholesaler Surety Bond (SCDMV form DLA-1B) — is a surety bond you must file to get or renew a South Carolina motor vehicle dealer or wholesaler license (S.C. Code § 56-15-320). The amount is $50,000 for a motor vehicle dealer or wholesaler, $25,000 for a motorcycle dealer or motorcycle wholesaler, and $15,000 for a wholesale auction. You file it with the SCDMV Business License Unit.
Good to know - Required for every South Carolina motor vehicle dealer and wholesaler license (S.C. Code § 56-15-320). The penal amount depends on your license type: $50,000 for a motor vehicle dealer or wholesaler, $25,000 for a motorcycle dealer or motorcycle wholesaler, and $15,000 for a wholesale auction. The $50,000 and $25,000 amounts took effect January 1, 2024 under Act #51 of 2023.
The bond is a promise that you will follow South Carolina’s dealer laws. If you or your employees commit fraud or make a fraudulent representation in the sale or transfer of a motor vehicle and a customer loses money, that person can file a claim against your bond up to its full amount.
The bond protects your customers, not you. If the surety company pays a claim, you must repay the surety. The bond must be written by a corporate surety company authorized to do business in South Carolina, and an owner, partner, or corporate officer of the dealership signs it.
South Carolina raised the required amounts on January 1, 2024 under Act #51 of 2023: the retail dealer and wholesaler bond went from $30,000 to $50,000, and the motorcycle dealer bond went from $15,000 to $25,000. Coverage must stay continuous — your license expires the moment your bond does.
Qualification
What You Need to Qualify for a South Carolina 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 South Carolina motor vehicle dealer or wholesaler license through the SCDMV Business License Unit.
- You know which license type you need — South Carolina sets the bond at $50,000 for a motor vehicle dealer or wholesaler, $25,000 for a motorcycle dealer or motorcycle wholesaler, and $15,000 for a wholesale auction.
- You have a bona fide place of business in South Carolina: a permanent structure with at least 96 square feet of floor space, occupied by you, and open to the public — not a home, tent, or temporary stand.
- You have a city or county compliance document (business license, zoning permit, or business registration) for that location before you apply.
- If you are applying for a retail dealer license and are not a franchise dealer, you have finished the required 8-hour pre-licensing course and have the original completion certificate.
- Your bond is written by a corporate surety company authorized to do business in South Carolina, and an owner, partner, or corporate officer will sign it.
Step by step
How to Get an Auto Dealer Bond in South Carolina: Step by Step
Confirm your license type and bond amount
South Carolina sets the bond by license type: $50,000 for a motor vehicle dealer or wholesaler, $25,000 for a motorcycle dealer or motorcycle wholesaler, and $15,000 for a wholesale auction. Pick the license that matches how you will sell vehicles so you buy the right bond amount.
Set up a bona fide place of business
Your location must be a permanent structure with at least 96 square feet of floor space, occupied by you and open to the public — not a home, tent, or temporary stand. Selling or exchanging motor vehicles must be the main business at the building. Get a city or county compliance document (business license, zoning permit, or business registration) before you apply.
Complete the 8-hour pre-licensing course
If you are applying for a retail dealer license and are not a franchise dealer, you must attend an 8-hour pre-licensing course before your license is issued. Keep the original certificate of completion — it must be submitted with your application.
Get your South Carolina dealer bond
Buy your bond and we handle the paperwork. We issue your Motor Vehicle Dealer and Wholesaler Surety Bond (DLA-1B) in the correct amount for your license type and provide it — with the required power of attorney — for your application. There is no bond form for you to download, complete, or sign.
Submit your dealer license application
Complete the Application for a Dealer or Wholesaler License (DLA-1) and file it with your bond and power of attorney, your city/county compliance document, your pre-licensing course certificate (retail non-franchise dealers), and the license fee to the SCDMV Business License Unit in Blythewood.
Application for a Dealer or Wholesaler License (DLA-1)Pass inspection and keep your bond continuous
After the SCDMV processes your application, an agent contacts you to schedule an inspection of your business. Once licensed, renew every twelve months and keep your bond active — a new bond or continuation certificate must stay on file each license period, and your license expires immediately if the bond lapses.
Paperwork
South Carolina Dealer Bond Forms & Documents
The SCDMV dealer/wholesaler license application. You complete and submit this to the Business License Unit.
View formThe South Carolina dealer surety bond form — we issue this in the correct amount for your license type and provide it, with the power of attorney, for your filing. There is nothing for you to complete.
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Cost
How South Carolina Auto Dealer Bond Pricing Works
You do not pay the full bond amount. The $50,000 figure (or $25,000 / $15,000, depending on your license type) is the coverage — the most claims can collect. You pay a premium, which is a small percentage of that amount.
Your premium is set by underwriting, mostly your personal credit. Well-qualified applicants pay a low rate. The premium is separate from South Carolina’s $50.00 dealer license fee and $20.00-per-plate fee.
Because South Carolina requires continuous coverage, most dealers buy the bond on a one-year term matched to the license and renew it each year with a continuation certificate.
Worked example
A South Carolina motor vehicle dealer needs a $50,000 bond. You do not pay $50,000 — you pay a premium, which is a percentage of that amount set mainly by your credit. A motorcycle-only dealer needs a smaller $25,000 bond and pays a proportionally lower premium.
Filing
Filing Information
South Carolina Department of Motor Vehicles (SCDMV) — Business License Unit
Filing notes
File the surety bond with your Application for a Dealer or Wholesaler License (SCDMV form DLA-1) at the SCDMV Business License Unit in Blythewood. The bond is written on the state Motor Vehicle Dealer and Wholesaler Surety Bond form (DLA-1B) and runs to the SCDMV.
South Carolina requires continuous coverage. A new bond or a proper continuation certificate must be on file every twelve months during the license period, and your dealer license expires immediately if the bond expires or is terminated — so keep your premium current to avoid a lapse.
We issue your South Carolina Motor Vehicle Dealer and Wholesaler Surety Bond (DLA-1B) in the correct amount for your license type and provide it — with the required power of attorney — for your application. There is no bond form for you to complete or sign.
At renewal the SCDMV does not require a brand-new bond and power of attorney; the surety files a continuation certificate to keep your existing bond in force for the next license period.
FAQ
South Carolina Auto Dealer Bond FAQ
Yes. Every South Carolina motor vehicle dealer or wholesaler must file a surety bond to be licensed (S.C. Code § 56-15-320), and the license expires immediately if the bond lapses.
It depends on your license type: $50,000 for a motor vehicle dealer or wholesaler, $25,000 for a motorcycle dealer or motorcycle wholesaler, and $15,000 for a wholesale auction. The $50,000 and $25,000 amounts took effect January 1, 2024 under Act #51 of 2023.
Act #51 of 2023 raised the amounts effective January 1, 2024. The retail dealer and wholesaler bond went from $30,000 to $50,000, and the motorcycle dealer bond went from $15,000 to $25,000. The wholesale auction bond stayed at $15,000.
The bond is written on SCDMV form DLA-1B, the Motor Vehicle Dealer and Wholesaler Surety Bond. You do not fill it out — we issue the bond in the correct amount and provide it, with the required power of attorney, for your application.
Your coverage must stay continuous. South Carolina requires a new bond or a proper continuation certificate on file every twelve months, and your license expires the moment your bond does. At renewal the surety usually files a continuation certificate rather than a brand-new bond.
You pay a premium, not the full bond amount. The premium is a small percentage of your bond amount, based mainly on your credit. Start a quote to see your rate.
Retail dealers who are not franchise dealers must complete an 8-hour pre-licensing course before the license is issued, and submit the original completion certificate with the application. Franchise dealers are not required to take it.
Anyone who loses money because of fraud or a fraudulent representation by you or your employees in the sale or transfer of a motor vehicle. The bond pays valid claims up to its full amount, and you must repay the surety.
Sources
Last verified 2026-07-01. Requirements change - confirm current details with South Carolina Department of Motor Vehicles (SCDMV) — Business License Unit before you file. This page is informational and not legal advice.
FAQ
South Carolina Auto Dealer Bond Questions
The cost of a South Carolina 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 South Carolina 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 South Carolina 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.
