Illinois Auto Dealer Bond— $50,000 × Every Location You Operate

Under 625 ILCS 5/5-102, Illinois requires a separate $50,000 bond or certificate of deposit for each location at which you intend to act as a vehicle dealer. This per-location requirement is more stringent than many states that require only one bond regardless of the number of locations. Each bond ensures that consumers at every dealership location are protected against dealer violations. For context, see how Illinois compares in our <a href="/auto-dealer-bonds/" class="text-amber-400 underline hover:text-amber-300">50-state auto dealer bond guide</a>.

Illinois vehicle dealers must maintain their bond for the first 60 consecutive months of business operations. After that period, you may discontinue the bond only if you have not been delinquent or deficient in transmitting title/registration fees or taxes during those 60 months. If you had any delinquency, the 60-month clock resets. Contact the Dealer/Remitter Licensing Section at (217) 782-7817 to verify your eligibility before canceling.

Illinois allows either a $50,000 surety bond or a $50,000 certificate of deposit from an Illinois financial institution. The CD must be in both the business name and the Secretary of State's name. While a CD avoids annual premium payments, it ties up $50,000 in capital per location. Most dealers choose the surety bond because it only costs 1-10% of the bond amount annually, freeing up working capital for inventory and operations. Learn more about <a href="/what-is-a-surety-bond/" class="text-amber-400 underline hover:text-amber-300">how surety bonds work</a> compared to other financial instruments.

The Secretary of State's mandatory 8-hour training for first-time used car dealer applicants covers licensure requirements, applicable state and federal taxes, consumer protection laws, title and registration procedures, and other topics affecting dealership operations. The training must be completed before your scheduled licensing date. Contact the Dealer/Remitter Licensing Section at (217) 782-7817 to schedule your training session.

Each $50,000 Illinois location bond typically costs $500-$5,000 annually. With excellent credit (750+), expect $500-$1,000 (1-2%). Good credit (680-749) costs $1,000-$2,000 (2-4%). Fair credit (620-679) ranges $2,000-$3,500 (4-7%). Below 620 may pay up to $5,000 (10%). A dealer with 3 locations and good credit would pay roughly $3,000-$6,000 total in annual bond premiums. Use our <a href="/tools/calculator/auto-dealer-bond/" class="text-amber-400 underline hover:text-amber-300">auto dealer bond calculator</a> for a personalized estimate or read our <a href="/auto-dealer-bonds/cost/" class="text-amber-400 underline hover:text-amber-300">auto dealer bond cost guide</a>.

The surety must provide 30 days written notice to the Secretary of State Dealer Licensing Section at 501 S. Second St., Springfield, IL 62756 before any bond cancellation takes effect. If your bond lapses, your dealer license is at risk of suspension. You must secure a replacement bond before the cancellation effective date to maintain continuous coverage and avoid license interruption.

Yes. We work with specialized carriers for higher-risk applicants and regularly approve applicants with credit scores as low as 500. Rates for the $50,000 Illinois bond with challenged credit typically range 5-10% ($2,500-$5,000 per location). We can often find competitive rates even for applicants with prior bankruptcies or tax liens. Our <a href="/surety-bond-cost/" class="text-amber-400 underline hover:text-amber-300">surety bond cost guide</a> explains how credit affects pricing.

The Illinois Secretary of State, Vehicle Services Department, Dealer/Remitter Licensing Section regulates all motor vehicle dealers in Illinois under the Illinois Vehicle Code (625 ILCS 5). The licensing section is located at 501 S. Second St., Springfield, IL 62756 and can be reached at (217) 782-7817.

Apply online with your business details and credit information for same-day approval on your $50,000 Illinois dealer bond. We issue the bond in the business name and the Secretary of State's name as required under 625 ILCS 5/5-102. Submit the bond with your completed Form VSD 659, $1,000 annual license fee, garage liability insurance, and 8-hour dealer training certificate (first-time used car dealers). Remember that each dealership location needs its own separate $50,000 bond. Illinois also offers a certificate of deposit alternative, but most dealers choose the surety bond to avoid tying up $50,000 in capital per location. You pay nothing until your bond is issued. See our <a href="/how-to-get-a-surety-bond/" class="text-amber-400 underline hover:text-amber-300">step-by-step bonding guide</a> for the full process.