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
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
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 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
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
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
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
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
Delus Johnson-Lead Instructor
Missouri Dealer Seminars