Kentucky Auto Dealer Bond$15,000-$100,000 MVC Requirement

Kentucky dealer bond costs vary by bond amount. For a $15,000 minimum bond, expect $150-$1,500 annually (1-10% based on credit). For a $100,000 bond, costs range from $1,000-$10,000 annually. Excellent credit (750+) pays 1-2%, while lower credit scores may pay up to 10%.

The Kentucky Motor Vehicle Commission reviews your financial statement, prior sales history, and financial position. Applicants with $100,000+ in liquid assets may not need a bond. Otherwise, the bond amount is calculated as the difference between required assets ($100,000) and your actual unencumbered cash/inventory, with a $15,000 minimum.

Kentucky requires either $100,000 in liquid business assets, OR $50,000 unencumbered cash plus $50,000 unencumbered motor vehicle inventory. Unencumbered real estate owned by the applicant may count toward the minimum. If requirements aren't met, a bond is required for the difference.

Kentucky requires garage liability insurance with minimum coverage of $250,000 per person, $500,000 per occurrence/incident, and $250,000 property damage. This is significantly higher than most states.

Kentucky requires permanent signage visible from the roadway with letters at least 9 inches in height. The trade name must incorporate words like "used cars," "auto sales," "auto mart," "motor sales," or similar wording identifying the business as a motor vehicle sales operation. Wholesale dealers are exempt from signage requirements.

The Commission meets on the second Friday of each month at 9:00 AM at 200 Mero Street, 1st Floor, Frankfort, Kentucky. Applications must be received at least 10 working days before the monthly meeting to be placed on the agenda.

Yes, Kentucky requires a separate dealer license for each location. Each location must meet all requirements including the surety bond, insurance, facility standards, and signage requirements.

Kentucky offers licenses for New Motor Vehicle Dealers, Used Motor Vehicle Dealers, Auction Dealers, Motorcycle Dealers, Mobility Vehicle Dealers, Motor Vehicle Leasing Dealers, Brokers, Wholesalers, Automotive Recycling Dealers, and Nonprofit Motor Vehicle Dealers.

All Kentucky dealer licenses expire December 31 annually and must be renewed prior to expiration. Make sure both your license and bond are renewed before the deadline to continue operating legally.