New York Auto Dealer Bond— Three Tiers: $20K / $50K / $100K

New York Vehicle & Traffic Law Section 415(6-b) establishes three bond tiers based on dealer type and annual sales volume: Tier 1 is $20,000 for used or wholesale dealers selling 50 or fewer vehicles per year. Tier 2 is $50,000 for all new/franchised dealers regardless of volume. Tier 3 is $100,000 for used or wholesale dealers selling more than 50 vehicles per year. Your required bond amount is determined by your license category and prior-year sales figures. The DMV reviews your tier annually. This is different from states like Texas (buysuretybonds.com/auto-dealer-bonds/texas/) and California (buysuretybonds.com/auto-dealer-bonds/california/) which use flat $50,000 bonds regardless of volume.

If your used or wholesale dealership sells more than 50 vehicles in a calendar year, you must upgrade from the $20,000 bond to the $100,000 bond tier. The DMV reviews annual sales reports submitted by dealers and cross-references title transfer records. If your volume crosses the 50-vehicle line, the DMV will notify you that a tier change is required. It is your responsibility to obtain the higher bond before continuing operations. Failure to maintain the correct bond tier can result in license suspension under VTL 415. Use our auto dealer bond calculator (buysuretybonds.com/tools/calculator/auto-dealer-bond/) to see how the premium changes between tiers.

Under VTL 415, dealers who exclusively sell the following six vehicle types are exempt from the surety bond requirement: trailers, motorcycles, vehicles over 10,000 lbs gross vehicle weight rating, all-terrain vehicles (ATVs), boats, and snowmobiles. The key word is "exclusively." If you sell any passenger vehicles or light trucks alongside exempt vehicle types, the full bond requirement applies to your entire operation. All exempt dealers still need a dealer license and must meet other licensing requirements.

Form VS-1D is the NYS DMV Original Facility Application — the primary application form for dealers and transporters that covers your business information, facility details, and ownership structure. Form VS-3 is the separate bond filing form where your surety company certifies the bond to the DMV. You submit both forms together as part of your complete application package, but VS-3 is prepared by your surety provider (that's us), not by the dealer. We handle the VS-3 preparation and filing as part of your bond issuance.

Yes. New York requires all employers to carry workers' compensation insurance and disability benefits insurance, and the DMV will not issue a dealer license without proof of both (or a valid exemption). Sole proprietors with no employees may file for an exemption using NYS Workers' Compensation Board Form CE-200. This is separate from your surety bond and garage liability insurance — learn the difference at buysuretybonds.com/bond-vs-insurance/. New York dealers need all three insurance/bond categories to operate legally.

A Certificate of Appointment is a written authorization from a vehicle manufacturer granting a dealer the right to sell that brand's new vehicles. Only franchised (new vehicle) dealers need this document — it proves your franchise relationship with the manufacturer. Used vehicle dealers and wholesale dealers do not need a Certificate of Appointment. For franchised dealers, this document is what places you in the $50,000 bond tier regardless of your sales volume.

The NYS DMV reviews dealer bond tiers as part of the annual license renewal cycle. They compare your prior-year sales volume against the 50-vehicle threshold using title transfer records and dealer-submitted sales reports. If your volume increased past 50 units, you'll receive a notice requiring a bond increase to $100,000. If your volume dropped below 50, you may request a tier reduction to $20,000. Franchised dealers always remain at $50,000 regardless of volume changes. Bond adjustments must be completed before your renewal is processed. For details on how premium costs change with bond amount, see our auto dealer bond cost guide at buysuretybonds.com/auto-dealer-bonds/cost/.

New York dealer bond costs depend on which of the three tiers you fall into under VTL 415(6-b). The $20,000 bond (used/wholesale, 50 or fewer vehicles) costs $200-$2,000 annually. The $50,000 bond (new/franchised dealers) runs $500-$5,000. The $100,000 bond (used/wholesale, 50+ vehicles) costs $1,000-$10,000 per year. Your exact premium depends on credit score, business financials, and industry experience. Pay only after your bond is approved. Use our <a href="/tools/calculator/auto-dealer-bond/" class="text-amber-400 underline hover:text-amber-300">auto dealer bond calculator</a> to estimate your rate.

Start by determining which bond tier applies to your dealership -- $20,000 for used/wholesale (50 or fewer vehicles), $50,000 for franchised, or $100,000 for high-volume used/wholesale. Apply online with your business and credit information for same-day approval. We prepare the bond on NYS DMV Form VS-3 and provide the original document for your application package. Submit the bond along with your completed Form VS-1D, garage liability insurance, workers' compensation coverage, and any required franchise documentation to the DMV. 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 complete process.