Michigan Auto Dealer Bond$25,000 SOS Requirement

Michigan auto dealer bonds ($25,000) typically cost $250-$2,500 annually based on credit. Excellent credit (750+) pays $250-$500 (1-2%). Good credit (680-749) costs $500-$1,000 (2-4%). Fair credit (620-679) ranges $1,000-$1,750 (4-7%). Lower credit scores may pay up to 10%.

Michigan increased its dealer bond requirement from $10,000 to $25,000 effective January 23, 2023. All new bonds filed after this date must be for $25,000. Existing dealers must update to $25,000 at their first renewal after January 23, 2023, or if their bond is cancelled.

Michigan dealers must be open minimum 30 hours per week, 48 weeks per year. At least 15 of those 30 hours must be between 8:00 AM and 5:00 PM, Monday through Friday.

Class A (New Vehicle Dealer), Class B (Used Vehicle Dealer), and Class D (Broker) all require the $25,000 bond. Classes C, E, F, G, R, and W dealers do NOT require a surety bond.

Anyone buying, selling, brokering, leasing, or dealing in 5 or more vehicles within a 12-month period must obtain a Michigan dealer license with the required $25,000 surety bond.

Your license is summarily suspended on the effective date of bond cancellation. You must immediately cease operations and cannot sell vehicles or process any transactions. The surety must give 30 days written notice to MDOS before cancellation.

The bond protects purchasers, sellers, lessees, financing agencies, and governmental agencies from fraud, cheating, or misrepresentation by the dealer, employees, agents, or salespeople. It also covers state sales tax or use tax deficiencies.

Yes, Class B (Used Vehicle) dealers must complete pre-licensing training within 6 months prior to application. The designated individual must also complete continuing education within 90 days after license issuance.

All Michigan dealer licenses expire annually on December 31st. You can renew online or by mail. If your license lapses more than 30 days, you must apply for a completely new license.