California Motor Vehicle Dealer Bond$50,000 or $10,000 — Veh. Code 11710, Form OL 25

No. California Vehicle Code Section 11710 sets two different amounts based on the kind of dealer. Retail dealers (new, used, RV, commercial, trailer), remanufacturers, and any wholesale-only dealer that sells 25 or more vehicles in a 12-month period must post a $50,000 bond on Form OL 25. Motorcycle-only dealers, ATV-only dealers, and wholesale-only dealers selling fewer than 25 vehicles per year file the $10,000 bond on Form OL 25B. There is no $25,000 tier and no separate "starter" amount. The decision is driven by license class and, for wholesale dealers, by the documented 12-month vehicle count.

The wholesale split is the single most misunderstood rule in California dealer bonding. Under Vehicle Code 11710(b), a wholesale-only dealer that sells 25 or more vehicles in a 12-month period must carry the $50,000 bond. Wholesale-only dealers selling fewer than 25 vehicles per year are eligible for the reduced $10,000 bond, but they must affirmatively demonstrate that lower volume to the DMV using Form OL 56 (the wholesale dealer bond reduction request) at original application or renewal. New wholesale applicants typically start at $50,000 until a 12-month sales history is on file. If you cross the 25-vehicle threshold mid-cycle, the DMV expects you to increase the bond to $50,000 within a reasonable period.

Two years. California dealer licenses run on a biennial cycle, not annual. The DMV mails an expiration notice approximately 90 days before the cycle ends, and renewal is completed on Form OL 45. Continuing education for used vehicle dealers is 4 hours every two years (not 8) — the franchised new auto dealer track is generally waived for the formal CE provider course but the dealer examination and inspection still apply. Pricing your bond should track the licensing cycle: many California sureties quote a multi-year premium with a built-in discount because the underlying bond runs alongside the two-year license term.

Form OL 25 (Rev. 3/2016) is the DMV-prescribed surety bond form for the $50,000 California motor vehicle dealer bond. The DMV will reject a generic surety bond, a bond drawn on another state's form, or a form with an older revision date if the operative language differs materially. For the $10,000 amount, the form is OL 25B; for lessor-retailers, OL 25C; and for the cash deposit alternative, OL 25E. The OL 25 names the principal as a motor vehicle dealer, the obligee as the Department of Motor Vehicles of the State of California, and conditions the bond on compliance with Division 5 of the Vehicle Code.

No. The $50,000 / $10,000 structure in Vehicle Code 11710(b) has been in place since the 2005 amendment that raised the retail amount from $25,000 to $50,000. The Consumer Automotive Recall Safety Act (SB 766) and other 2024–2025 dealer-adjacent legislation did not change the bond amount or the form. If a competitor article claims California increased the dealer bond in the current year, that is inaccurate — what may have changed are pre-licensing education provider rules, inspection cadence, or the New Motor Vehicle Board fee, but not the bond itself.

Yes, but it is rarely the right call. Vehicle Code 11710 lets a dealer file a $50,000 cash deposit with the DMV on Form OL 25E in lieu of a surety bond. The cash is held by the DMV for the life of the license and for an extended tail period after surrender or revocation to settle claims. The opportunity cost is significant: a dealer with even fair credit pays a fraction of $50,000 in annual surety premium and keeps the working capital deployed in inventory. Cash deposits are most often used by dealers who cannot qualify for a surety bond at any price or who are repairing credit after a prior bond claim.

No. Under Vehicle Code 11735, an autobroker endorsement attaches to the existing dealer license and bond — it is not a standalone bond instrument. A dealer that wishes to act as an autobroker (negotiate the retail sale of a vehicle for a fee on behalf of a buyer) requests the endorsement through the DMV but does not need to file a second surety bond. Brokers who attempt to operate without holding a dealer license at all are a different matter and are generally outside the bond framework entirely.

The bond is conditioned on compliance with Division 5 of the Vehicle Code and related DMV regulations. The most common claim categories are: failure to deliver title within 30 days of sale; odometer fraud or rollback; failure to pay off a trade-in lien; sales tax collected from the consumer but never remitted to the CDTFA; misuse of dealer or temporary plates; and material misrepresentation in the sale (e.g., undisclosed prior salvage, undisclosed prior frame damage). A claim is paid out of the bond up to the face amount; the surety then has recourse against the dealer personally under the indemnity agreement signed at issuance.

For straightforward applicants — clean credit, no prior bond claims, no open litigation — the $50,000 motor vehicle dealer bond can typically be underwritten and issued the same business day, with the executed Form OL 25 sent in the correct DMV-prescribed format. For applicants with mid-tier or challenged credit, additional underwriting (financials, prior dealership operating history, explanations of derogatory credit items) may extend the timeline to a few business days. The DMV itself has up to 120 days under Vehicle Code 11704 to investigate a complete application, so the bond is virtually never the slowest step.

Generally yes. The California dealer license is tied to an established place of business under Vehicle Code 11712, and each licensed location requires its own license number. The bond filed for each license number is the $50,000 OL 25 (or $10,000 OL 25B as applicable). A dealer operating two retail lots in California posts two bonds, one per licensed location. The bond does not "stack" — a claim against one location is paid up to the $50,000 face on that location's bond.