Pennsylvania Auto Dealer Bond$20,000 PennDOT Requirement

Pennsylvania auto dealer bonds ($20,000) cost $200-$2,000 annually depending on credit. With excellent credit (750+), expect $200-$400 (1-2%). Good credit (680-749) costs $400-$800 (2-4%). Fair credit (620-679) ranges $800-$1,400 (4-7%). Lower credit scores may pay up to $2,000 (10%).

Under 75 Pa.C.S. Section 1301 (Pennsylvania Vehicle Code), all motor vehicle dealers must post a $20,000 surety bond with PennDOT as a condition of dealer registration. The bond must be from a surety company authorized to do business in Pennsylvania. PennDOT requires the bond to be filed on Form MV-375, the department's approved bond form.

PennDOT issues dealer registrations in six categories: New Vehicle Dealer (franchise required), Used Vehicle Dealer, Wholesale Vehicle Dealer (dealer-to-dealer only), Salvor/Salvage Dealer, Vehicle Auction, and Public or Retail Consignment dealer. All categories require the same $20,000 surety bond and $75 registration fee.

PennDOT dealer registration typically takes 6-10 weeks from completed application to license issuance. A PennDOT enforcement officer must conduct a facility inspection. Your surety bond can be issued within 1 business day. Start your bond application early since PennDOT will not schedule the inspection until they have your bond and insurance on file.

Pennsylvania requires a permanent established place of business with an enclosed office area for conducting business with customers. You must have a permanent sign displaying the dealership name visible from the public roadway. The lot must have customer parking separate from display inventory. Your location must have proper commercial zoning approval from the local municipality or county. Residential locations are not permitted.

Pennsylvania requires garage liability insurance with a minimum $300,000 combined single limit (CSL). This is separate from your $20,000 surety bond. The insurance must cover garage operations including test drives and customer vehicles in your care, custody, and control. Proof of insurance must be filed with PennDOT as part of your dealer registration application.

Yes. Approval is possible even with credit challenges. While excellent credit (750+) gets the lowest rates at 1-2% of the $20,000 bond amount, we regularly approve applicants with credit scores in the 500-600 range at 5-10%.

Yes. Each physical dealership location must have its own separate dealer registration and corresponding $20,000 surety bond. If you operate multiple lots, each requires a separate Form MV-312, bond, insurance certificate, zoning approval, and facility inspection. PennDOT treats each location as a separate dealer registration.

PennDOT issues dealer registration plates for dealer-owned vehicles used in the business. Dealer plates may be used on vehicles owned by the dealership for display, demonstration, testing, or delivery purposes. Each plate must be properly logged. Misuse of dealer plates can result in penalties and bond claims. PennDOT strictly enforces dealer plate regulations.

Pennsylvania dealer registrations renew annually. PennDOT sends renewal notices approximately 60 days before expiration. Your surety bond is continuous until canceled and renews automatically each year with a new premium. Never let your bond lapse -- it results in immediate suspension of your dealer registration by PennDOT.