Missouri Dealer Surety Bond!

Before you are granted a Missouri Dealer License by the Missouri Department of Revenue, you must obtain a $50,000 dealer surety bond or a $50,000 irrevocable letter of credit. In the past a dealer was allowed to simply maintain a $25,000 dealers surety bond, but in 2018 the Missouri Legislature passed Missouri Senate Bill 707 that greatly altered the landscape of how to operate a dealership in the state of Missouri. Now all dealers are required to purchase a $50,000 dealer surety bond, or if you like you may purchase a $50,000 irrevocable letter of credit, which I will explain in a moment.

Missouri Dealers are required to hold these to ensure we operate our businesses with the highest level of ethical standards. Let me explain a the purpose of the financial instruments.
Let's say for example that some old school, unethical person was able to pass a background check and was able to obtain a Missouri dealers license. And let's say this person sold 3 cars with bad transmissions and did not disclose the vehicle defects to the customer.

The first thing that has occurred in this scenario is that the dealer has broken multiple State and Federal laws. A dealer may never sell a vehicle when the dealer is aware of mechanical defects and NOT disclose the defects to the customer. You must any motor vehicle defects that you are aware of in advance of the sale of the vehicle. You will learn how to correctly disclose defects in you dealers license training class.

Within a day or two after this transaction the customers that purchased the vehicle from the dealer are going to realize the purchased a vehicle with undisclosed mechanical defects and immediately sue the dealer. Whenever a lawsuit is filed against a dealer in Missouri the lawsuit is public knowledge. The Missouri Department of Revenue will track any lawsuit filed against anyone with a Missouri dealer license and if the dealer is convicted of any type of fraudulent sales activity by any Missouri court, the Missouri Department of Revenue has a simple solution, they will simply revoke the dealers license.

What happens after the DOR revokes the dealers license? The dealer no longer has a lot, no longer has any revenue coming in, the dealer will probably have no money and could possibly declare bankruptcy. If a dealer has had there dealer license revoked how it it possible for the previous customers to seek financial recourse for the defective vehicles the purchased.

No matter how broke the dealer is the customer can gain a $50,000 claim against the dealer surety bond or revocable letter of credit.

A Missouri dealer surety bond or irrevocable letter of credit ensures the Missouri dealer runs their business with the highest levels of ethical standards. If you operate ethically it is much less likely that anyone will ever sue your dealer surety bond.

For a quote on a Missouri Dealer Surety bond, please click on the Missouri Dealer Surety Bond Quote page here.



Missouri Dealer Seminars is committed to providing you with the highest quality customer service available today. You will receive professional customer support before, during, and after your Missouri Dealer Seminar.

We invite you to use our convenient Contact Us form or call us toll free at 1-800-369-2467 with your questions at any time.

We are here to help you start your Missouri Dealership!

Delus Johnson-Lead Instructor
Missouri Dealer Seminars

Missouri Dealer License Instructor