Hawaii Auto Dealer Bond— $10K to $200K — Five Tiers
Hawaii is one of only a few states that offers a line of credit alternative to the surety bond — and one of even fewer with a 5-tier bond structure. Your required amount depends on whether you sell motorcycles, used vehicles, or new vehicles, and your monthly sales volume. Most dealers choose the surety bond because it costs a fraction of the LOC capital requirement.
Biennial term renewing June 30 of even-numbered years. Required under HRS Chapter 437 by the Motor Vehicle Industry Licensing Board. If you are new to surety bonds, our surety bond overview explains the basics.
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Five Bond Tiers: How Hawaii Scales Dealer Bonds by Type and Volume
No other state uses a 5-tier bond structure that combines dealer type with monthly sales volume. Your tier is locked to two factors under HRS 437: what you sell, and how many units you move per month.
Hawaii Auto Dealer Bond Tiers — HRS Chapter 437
Bond amount determined by dealer type and monthly sales volume
Motorcycle / Scooter
$10,000
Scooters over 49cc and motorcycles
Used (<60 units/mo)
$25,000
Small to mid-size used lots — most common tier
New (<10 units/mo)
$50,000
Low-volume franchise dealers
Used (60+ units/mo)
$100,000
High-volume used vehicle dealers
New (10+/mo) & Auction
$200,000
High-volume franchise and auction dealers
Hawaii Revised Statutes Chapter 437
Per biennial term. Motorcycle and small used dealers. Use our bond cost calculator to estimate your rate.
Per biennial term. New franchise dealers selling fewer than 10 units/month.
Per biennial term. High-volume used, franchise, and auction dealers. See our surety bond cost guide for credit-based pricing.
Line of Credit vs. Surety Bond: Why Most Hawaii Dealers Choose the Bond
Hawaii is unique among all 50 states in that the surety bond is technically the alternative to a secured line of credit, not the other way around. Under HRS 437, the Board accepts a bond "when a line of credit cannot be reasonably obtained." In practice, however, the vast majority of dealers opt for the bond.
The reason is economics. A secured line of credit from a federally insured financial institution requires you to tie up the full amount in capital. For a motorcycle dealer, that means $50,000 in locked-up funds for a $10,000 bonding requirement — five times the bond amount. For used dealers, the LOC is $50,000 regardless of whether your bond tier is $25,000 or $100,000.
A surety bond, by contrast, costs only 1-10% of the face amount. A $25,000 bond with good credit might cost $500 per biennial term — freeing the remaining $49,500 for inventory, marketing, and operations.
| Dealer Type | Bond Amount | LOC Amount | Notes |
|---|---|---|---|
| Motorcycle & Motor Scooter Dealers | $10,000 | $50,000 | Scooters over 49cc included |
| Used Vehicle Dealers (<60 units/mo) | $25,000 | $50,000 | Most common for small used lots |
| New Vehicle Dealers (<10 units/mo) | $50,000 | Per franchise agreement | Low-volume franchise dealers |
| Used Vehicle Dealers (60+ units/mo) | $100,000 | $50,000 | High-volume used dealers |
| New Vehicle Dealers (10+ units/mo) | $200,000 | Per franchise agreement | High-volume franchise dealers |
| Auction Dealers | $200,000 | $100,000 | Vehicle auction operations |
Key insight: Notice that the LOC amounts are often higher than the bond amounts. A motorcycle dealer needs only a $10,000 bond but a $50,000 LOC — making the bond the clear winner for capital efficiency.
Multi-Island Dealerships: One Bond Per Location, Per Island
Hawaii's island geography creates a unique compliance dimension for dealers. Each physical dealership location must hold its own license and bond, and there is no inter-island exemption. A dealer with lots on Oahu, Maui, and the Big Island needs three separate licenses and three separate bonds.
The bond tier for each location is determined independently based on that location's dealer type and volume. Your Honolulu lot selling 70 used vehicles per month would need a $100,000 bond, while a smaller Kailua-Kona lot selling 30 would need only $25,000.
We can issue multiple Hawaii bonds from a single application. Multi-location operators typically receive volume discounts on premiums. You can also explore our complete bond offerings for other business needs. Request a multi-location quote and specify each island location.
Official Hawaii Requirements
"When a line of credit cannot be reasonably obtained, the board may accept a surety bond... in the amount specified for the class of license applied for."Hawaii Motor Vehicle Industry Licensing Board • HRS Chapter 437
DCCA Dealer Licensing: Full Application Checklist
Complete requirements from the Department of Commerce and Consumer Affairs for obtaining a motor vehicle dealer license. For a comparison of bond amounts nationwide, see our auto dealer bonds overview. Hawaii notaries need a separate Hawaii notary bond. Contractors need a Hawaii contractor license bond.
Application Checklist (Rev. 07/2024)
- Complete DCCA Motor Vehicle Dealer/Auction Application (revised 07/2024)
- Surety bond ($10,000-$200,000 based on dealer type and volume)
- Secured line of credit from a federally insured financial institution (alternative to bond)
- General excise tax license from Hawaii Department of Taxation
- Certificate of good standing from Hawaii DCCA Business Registration Division
- Garage liability insurance (minimum $300,000 combined single limit)
- Established place of business with permanent sign displaying business name
- County zoning approval for motor vehicle sales
- Criminal background check for all owners, officers, and partners
- Proof of completing pre-licensing education if required by the Board
- $500 biennial compliance resolution fund fee (per franchised dealer)
Bond Filing Details
Four Dealer Categories, Five Bond Tiers
Bond amounts vary within each category based on monthly sales volume. Learn how to get a surety bond step by step. Not sure how bonds differ from insurance?
New Vehicle Dealer
Franchise dealers with manufacturer agreement
Used Vehicle Dealer
Independent used car lots
Motorcycle/Scooter Dealer
Motorcycles and scooters over 49cc
Auction Dealer
Vehicle auction operations
Step-by-Step: Getting Licensed Through the DCCA Board
The Board meets monthly to review applications — plan for 4-6 weeks processing
Determine Your Tier & Get Bonded
Identify your dealer category and monthly sales volume to determine your bond amount. Apply online for same-day approval on bonds from $10,000 to $200,000.
Prepare DCCA Application
Complete the Motor Vehicle Dealer/Auction Applicant Requirement Checklist (rev. 07/2024). Gather your GET license, certificate of good standing, insurance, and zoning approval.
Submit to the Board
File your application with the Motor Vehicle Industry Licensing Board at DCCA. Allow 4-6 weeks for processing. The Board meets monthly to review applications.
Hawaii Dealer Bond Questions: 5-Tier System and LOC Alternative
State-specific questions about Hawaii's unique bond and licensing structure. See our auto dealer bond cost guide for credit-based pricing across all tiers.
How does Hawaii's 5-tier bond system differ from other states?
Hawaii uses a 5-tier bond system under HRS 437 that factors both dealer type and monthly sales volume. Motorcycle/scooter dealers need $10,000. Used vehicle dealers selling fewer than 60 units per month need $25,000, while those selling 60+ units need $100,000. New vehicle dealers selling fewer than 10 new units per month need $50,000, and those selling 10+ new units need $200,000. Auction dealers also require $200,000. Most states use flat amounts or 2-3 tiers — Hawaii's 5-tier system is among the most granular in the country.
What is the line of credit alternative and why do most dealers choose the bond instead?
Hawaii uniquely requires either a secured line of credit from a federally insured financial institution OR a surety bond. The line of credit amounts often exceed bond amounts: motorcycle dealers need a $50,000 LOC vs. only $10,000 bond, and used dealers need a $50,000 LOC vs. $25,000 bond. The Board accepts a surety bond when a line of credit "cannot be reasonably obtained." In practice, most dealers choose the bond because it costs only 1-10% of the face amount and does not tie up working capital the way a line of credit does.
How much does a Hawaii dealer bond cost across all 5 tiers?
Costs depend on which tier applies to your dealership. For the most common $25,000 used dealer bond, expect $250-$2,500 per biennial term (1-10%). A $10,000 motorcycle dealer bond starts as low as $100. The $50,000 new dealer bond costs $500-$5,000. Higher tiers like $100,000 or $200,000 bonds cost $1,000-$20,000. Your credit score, financial history, and industry experience determine your exact rate.
When do Hawaii dealer licenses and bonds renew?
Hawaii dealer licenses are biennial (2-year), expiring on June 30 of each even-numbered year regardless of when they were originally issued. Your bond must match this biennial period. The next renewal date is June 30, 2026. We send renewal reminders 90 days in advance to ensure no lapse in your bond or license.
Does selling on multiple islands require separate bonds?
Yes. Each physical dealership location must have its own separate license and corresponding surety bond. If you operate a used car lot in Honolulu and another in Hilo, you need two separate dealer licenses and two separate bonds. The bond amount for each location depends on that location's dealer type and sales volume. Inter-island shipping adds complexity but does not change the per-location bond requirement.
Who oversees auto dealer licensing in Hawaii?
The Motor Vehicle Industry Licensing Board, operating under the Hawaii Department of Commerce and Consumer Affairs (DCCA) Professional and Vocational Licensing Division, oversees all dealer licensing. The Board holds regular meetings and can investigate complaints, conduct hearings, and revoke licenses. Their office is located at 335 Merchant Street in Honolulu.
What happens if my Hawaii dealer bond lapses?
If your surety bond expires or is canceled, your dealer license is automatically suspended. You cannot buy, sell, or exchange motor vehicles during the suspension period. If you fail to provide a replacement bond within 30 days, the Motor Vehicle Industry Licensing Board may revoke your license entirely. Reinstatement requires a new application, bond, and applicable fees.
Auto Dealer Bonds in Other Pacific States
Compare Hawaii's 5-tier system with other states. California uses a flat $50,000 while Alaska requires $100,000.
Official Hawaii DCCA Resources
Estimate Your Hawaii Auto Dealer Bond Premium
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Other Hawaii Bonds
Additional surety bonds available in Hawaii
All content is researched from official state and federal sources (.gov) and verified before publication. BuySuretyBonds.com works with Treasury-certified, A- minimum rated surety carriers serving all 50 states.
Skip the Line of Credit — Get Your Hawaii Bond Instead
All 5 tiers available ($10K-$200K). Pay 1-10% instead of locking up the full LOC amount.
Get Your Auto Dealer Bond Quote
Same-day DMV approval available • All dealer types
Pay only after your bond is issued • No obligation • 2 minutes