Arizona Auto Dealer Bond

Arizona increased the retail dealer bond to $100,000 under ARS 28-4362 after a pattern of consumer losses from dealer fraud exceeded the old $25,000 bond limits. The higher amount gives consumers meaningful recovery when a dealer fails to deliver a title, misrepresents a vehicle, or closes without honoring warranties. Wholesale dealers kept the $25,000 requirement because they only transact with licensed dealers who have their own protections. Learn more about what a surety bond is and how it protects consumers.

Arizona no longer accepts paper dealer license applications. You must submit everything electronically through the ADOT MVD Dealer Licensing portal. Upload your surety bond (Form 38-1301), garage liability insurance certificate, TPT license, facility photos, and fingerprint clearance card documentation. The system validates required fields before submission, which reduces processing delays from incomplete applications. Expect 4-6 weeks for complete review including facility inspection. See our step-by-step guide to getting a surety bond for the bonding portion of the process.

Arizona requires all dealer license principals, partners, and corporate officers to obtain a Fingerprint Clearance Card through the Arizona Department of Public Safety. This is a state-level background check using LiveScan fingerprinting at an approved vendor. The card must be valid at the time of application and renewed every six years. Certain criminal convictions — including fraud, theft, and felony drug offenses — will result in denial. The fingerprint card process typically takes 4-6 weeks and costs approximately $67.

No. Arizona wholesale dealers are strictly prohibited from selling to consumers, displaying vehicles for public sale, or advertising to the general public. If a wholesale dealer wants to sell retail, they must apply for a separate retail dealer license, secure the higher $100,000 bond, obtain garage liability insurance for a retail location, and pass a facility inspection at a commercially zoned property. Operating retail under a wholesale license is a violation that can trigger bond claims and license revocation. Our step-by-step bonding guide walks through the process for upgrading.

Yes. Each physical dealership location in Arizona requires a separate dealer license and a separate surety bond at the corresponding amount for that license type. A dealer with a used car lot in Phoenix and another in Tucson needs two $100,000 bonds and two annual license fees ($100 each, or $400 if you have a third-party lender relationship per ARS 28-4302). There is no multi-location discount on the bond itself, though some sureties offer account-level pricing for multiple bonds. Illinois has a similar per-location requirement at $50,000 per site.

Under ARS 28-4362, claims arise when a dealer causes financial harm through failure to deliver a vehicle title within the statutory timeframe, odometer tampering or rollback, material misrepresentation of a vehicle's condition or history, selling a vehicle with an undisclosed salvage title, accepting deposits for vehicles the dealer cannot deliver, or violating Arizona's lemon law or consumer protection statutes. The surety investigates each claim. If valid, payment is made up to the bond penalty, and the dealer must reimburse the surety in full plus legal costs. This indemnity obligation is a key difference between bonds and insurance.

For the $100,000 retail bond, expect to pay 1-3% ($1,000-$3,000) with excellent credit (750+), 3-5% ($3,000-$5,000) with good credit (680-749), 5-8% ($5,000-$8,000) with fair credit (620-679), and 8-12% ($8,000-$12,000) with challenged credit below 620. The $25,000 wholesale bond costs proportionally less — roughly $250-$3,000 depending on credit. Use our auto dealer bond calculator to estimate your specific rate. For a deeper breakdown, read our auto dealer bond cost guide.

Arizona requires a commercially zoned location (residential addresses are prohibited) with a permanent business sign visible from the road, an enclosed office for completing transactions, adequate vehicle display area with proper lighting, and compliance with local business licensing and zoning ordinances. ADOT MVD conducts a facility inspection with required photographs before approving any license. The location must be ready before you apply — you cannot submit an application for a location under construction.

Apply online with your business details and credit information for same-day approval. Arizona uses a three-tier system under ARS 28-4362: $100,000 for retail dealers, $25,000 for wholesale, and $20,000 for recyclers. We issue the bond on ADOT MVD Form 38-1301 and provide the document for your electronic application submission. Upload the bond along with your garage liability insurance, TPT license, facility photos, and Fingerprint Clearance Card through ADOT MVD's electronic-only dealer licensing portal. Arizona no longer accepts paper applications. You pay nothing until your bond is approved. See our step-by-step bonding guide for the full process.