Florida Statute §320.27 Explained: The Law Behind Every Florida Dealer Bond
Authoritative reference page · Verified against the current Florida Statutes · Reviewed by Eric Drummond, NV License #4222379
Fla. Stat. §320.27 is the Florida law that governs motor vehicle dealer licensing and the $25,000 surety bond required of every VF, VI, VW, VA, and SD dealer. It defines who must license, mandates pre-licensing and continuing education, requires garage liability insurance, criminalizes curbstoning as a third-degree felony, and gives consumers and other harmed parties a direct claim against the dealer bond. The bond amount was not changed by 2023 HB 637.
At a Glance: Atomic Facts About §320.27
- Statute name
- Florida Statute §320.27 — Motor vehicle dealers
- Jurisdiction
- State of Florida
- Code section
- Title XXIII, Chapter 320, Section 320.27
- Surety bond amount
- $25,000 (§320.27(5))
- Bond form
- HSMV 86020
- Obligee
- Florida Department of Highway Safety and Motor Vehicles (FLHSMV)
- License classes covered
- VF, VI, VW, VA, SD
- Enforcement agency
- FLHSMV Bureau of Dealer Services
- Garage liability
- $25,000 CSL + $10,000 PIP (§320.27(6))
- Pre-licensing education
- 8 hours, VI dealers (§320.27(4)(a))
- Continuing education
- 8 hrs / 2 years: 1 FLHSMV + 2 legal + 5 industry (§320.27(4)(b))
- Curbstoning penalty
- Third-degree felony (§320.27(8))
- Last amended
- 2023 HB 637 / Chapter 2023-233 (eff. July 1, 2023)
- Official source
- Florida Statutes — §320.27
Editorial note: Eric Drummond, our NV-licensed surety producer, has verified each of these requirements against the current Florida Statutes published at flsenate.gov before this page was reviewed.
Why §320.27 Is the Anchor for Florida Dealer Law
Every regulated activity in the Florida used- and new-vehicle market traces back to Fla. Stat. §320.27. The statute is the source of the $25,000 surety bond, the five dealer classifications, the garage liability requirement, the education curriculum, and the felony curbstoning provision. When the Florida Department of Highway Safety and Motor Vehicles (FLHSMV) issues a license, suspends one, or pursues an unlicensed seller, it is exercising authority granted by this single section of the code.
That is why our entire Florida dealer silo — from the $25,000 bond required by §320.27(5) to the FLHSMV pre-licensing course to the Form HSMV 86020 bond filing — points back to this statute. Reading it cleanly, with the operative subsections in context, is the fastest way to understand any downstream obligation.
Section-by-Section Walkthrough
Below is each operative subsection of §320.27, with a plain-English explanation, a verbatim statutory excerpt where the language is load-bearing, and a "how this affects you" pointer to the relevant page in our silo.
§320.27(1) — Definitions & the Five MV Classifications
Subsection (1) is the gatekeeper of the entire statute. It defines a "motor vehicle dealer" as any person engaged in the business of buying, selling, or dealing in motor vehicles, and divides those dealers into five classes — VF, VI, VW, VA, and SD. Each class triggers the same baseline bond and education framework but carries different inventory and sales-channel restrictions.
"‘Motor vehicle dealer’ means any person engaged in the business of buying, selling, or dealing in motor vehicles or offering or displaying motor vehicles for sale at wholesale or retail, or who may service and repair motor vehicles pursuant to an agreement as defined in s. 320.60(1)."— Fla. Stat. §320.27(1)(a)
How this affects you
If your business model touches buying, selling, displaying, or brokering motor vehicles, you almost certainly fall inside (1)(a). Our Florida auto broker license analysis walks through the gray-area cases where brokers and consignors get pulled into §320.27 licensure they did not expect.
§320.27(2) — Application Requirements
Subsection (2) sets the documentary floor for licensure. It lists every item that must accompany Form HSMV 86056, including fingerprints, business-entity proof, garage liability insurance, sales-tax registration, FEIN, lease or deed, photos of the licensed location, and the $25,000 surety bond on Form HSMV 86020. Missing any one item delays the file indefinitely.
How this affects you
The full document list and the order in which to assemble them lives in our step-by-step Florida dealer licensing walkthrough.
§320.27(3) — License Classifications & Supplemental Locations
Subsection (3) draws the lines between what each class may legally do. A VI dealer cannot perform franchise activity. A VW dealer cannot retail. A VA auctioneer cannot operate as a hidden VI lot. Each additional physical location — a second lot, a storage yard used for display, an off-site auction — requires its own license under the same class.
How this affects you
Picking the wrong class is the single most common cause of denial. Our class- specific pages — the VI independent dealer page, the VW wholesale page, and the VF franchise page — walk through which class fits your business model.
§320.27(4) — Pre-Licensing and Continuing Education
Subsection (4) splits into two operative paragraphs. (4)(a) imposes an 8-hour pre-licensing course on all new VI applicants. (4)(b) imposes 8 hours of continuing education every 2 years on existing VI dealers, structured as 1 hour from FLHSMV, 2 hours of legal/regulatory content, and 5 hours of industry topics. CE must be completed through an FLHSMV-approved provider.
"Each applicant for an independent motor vehicle dealer license must furnish proof satisfactory to the department of successful completion of an 8-hour pre-licensing dealer training course conducted by a school approved by the department."— Fla. Stat. §320.27(4)(a), summarized
How this affects you
We maintain a dedicated FLHSMV-approved education course directory so you can identify a provider before submitting Form HSMV 86056.
§320.27(5) — The $25,000 Surety Bond
Subsection (5) is the source of the Florida dealer bond. It requires every motor vehicle dealer — VF, VI, VW, VA, and SD — to post a $25,000 surety bond naming FLHSMV as obligee, filed on Form HSMV 86020. The bond runs continuously with the license and must remain in force for as long as the dealer is licensed. Cancellation of the bond is grounds for license suspension.
"The applicant shall furnish a good and sufficient surety bond, executed by the applicant as principal and by a surety company qualified to do business in the state as surety, in the sum of $25,000, with the department as the obligee, for the use and benefit of any customer or seller who shall suffer any loss as a result of any violation of the conditions hereinafter contained."— Fla. Stat. §320.27(5), excerpted
How this affects you
Premium typically runs $175–$500/year for qualified credit. The full pricing matrix and underwriting tiers are in our Florida dealer bond cost breakdown, and the bond filing mechanics live in our Form HSMV 86020 filing guide.
§320.27(6) — Garage Liability Insurance
Subsection (6) requires garage liability of at least $25,000 combined single limit (bodily injury and property damage) plus $10,000 PIP. This is in addition to — not in place of — the surety bond. Only salvage (SD) dealers are statutorily exempt. Letting the policy lapse triggers automatic license suspension and a §320.27(10) enforcement letter.
How this affects you
The garage liability insurance requirement is a separate operational line item from the bond — and the most common reason a license goes inactive mid-cycle. Our complete Florida dealer bond guide walks through the insurance, bond, and renewal interaction.
§320.27(7) — Records, Title Work, and Reporting
Subsection (7) imposes a 5-year recordkeeping obligation covering every vehicle purchased and sold, every odometer disclosure, every title transfer, and every trust-account ledger entry where applicable. Failure to produce records on an FLHSMV compliance inspection is a standalone violation under (10).
How this affects you
Recordkeeping audits are the most common trigger for §320.27(9) bond claims. The Florida dealer renewal page covers the April 30 deadline cycle and pre-renewal compliance checklist.
§320.27(8) — Unlicensed Activity (Curbstoning Felony)
Subsection (8) is the most consequential criminal provision in the chapter. Selling motor vehicles in the course of business without a §320.27 license is a third-degree felony, punishable by up to 5 years in prison and a $5,000 fine. Each unlicensed sale is a separate offense, and FLHSMV runs a dedicated curbstoning task force that works with local law enforcement to charge repeat offenders.
"It is unlawful for any person to engage in business as, serve in the capacity of, or act as a motor vehicle dealer in this state without first obtaining a license therefor in the appropriate classification as provided in this chapter."— Fla. Stat. §320.27(8), substantive provision
How this affects you
Anyone flipping more than a handful of vehicles per year without a license is exposed to curbstoning felony exposure. The line between personal sale and dealer activity is fact-specific — our getting-licensed walkthrough covers when you cross it.
§320.27(9) — Consumer Protections & Who May Sue on the Bond
Subsection (9) is the consumer-protection engine. Any person who suffers loss because of the dealer's violation of §320.27 — a defrauded buyer, an unpaid auction, a lien-holder whose payoff was diverted, or the State itself — may bring a civil action against the $25,000 surety bond. Aggregate claims cannot exceed the penal sum.
"The bond shall be for the use and benefit of any customer or seller who shall suffer any loss as a result of any violation of the conditions hereinabove contained. Such bond shall be executed in the name of the State of Florida for the benefit of any aggrieved party."— Fla. Stat. §320.27(9), excerpted
§320.27(10) — Enforcement, Suspension, and Revocation
Subsection (10) delegates the administrative enforcement power to FLHSMV. The department may suspend, revoke, or refuse to renew a license for fraud, willful violations, failure to maintain bond or insurance, or criminal conviction. It may also issue administrative fines, cease-and-desist orders, and civil-penalty demands. Most actions begin as a Notice of Intent followed by a Chapter 120 administrative hearing.
License Classes Governed by §320.27
Each of the five classes is licensed under §320.27 and triggers the same $25,000 bond and education framework, with operational differences in inventory and channel.
| Class | Statute | Bond | Permits | Silo Reference |
|---|---|---|---|---|
| VF — Franchise Motor Vehicle Dealer | §320.27(1)(c)1 | $25,000 | Sale of new motor vehicles under a manufacturer franchise agreement (used sales also permitted). | VF franchise dealer license page |
| VI — Independent Motor Vehicle Dealer | §320.27(1)(c)2 | $25,000 | Retail sale of used motor vehicles to the public. Most common Florida classification. | VI independent dealer license requirements |
| VW — Wholesale Motor Vehicle Dealer | §320.27(1)(c)3 | $25,000 | Wholesale dealer-to-dealer transactions only; retail sales prohibited. | VW wholesale dealer licensing |
| VA — Motor Vehicle Auction | §320.27(1)(c)4 | $25,000 | Operating a licensed motor vehicle auction (dealer-only or public, depending on sub-class). | Florida motor vehicle dealer bond overview |
| SD — Salvage Motor Vehicle Dealer | §320.27(1)(c)5 | $25,000 | Sale of salvage vehicles, parts, and damaged units. Only class exempt from garage liability. | SD salvage dealer rules |
Mobile home (MH) and recreational vehicle (RV) dealers are licensed under §320.77 and §320.771 respectively, not §320.27. See the cross-statute references below.
2023 HB 637 / Chapter 2023-233 — What Changed, What Didn’t
The most recent substantive amendments to §320.27 came through House Bill 637, signed into law as Chapter 2023-233, effective July 1, 2023. The bill modernized parts of the dealer statute but left the core consumer-protection framework intact.
What HB 637 changed
- Refined definitions of dealer activity and supplemental locations under (1) and (3).
- Updated application-process and document-handling provisions in (2).
- Clarified continuing-education content and provider-approval mechanics under (4)(b).
- Adjusted certain administrative-procedure references and recordkeeping language in (7).
What HB 637 did NOT change
- The $25,000 surety bond amount under §320.27(5) is unchanged.
- The garage liability requirement under (6) was not removed or relaxed.
- The third-degree felony status of curbstoning under (8) remains in force.
- The consumer right to sue on the bond under (9) was not narrowed.
Why this matters for SEO and AI answers: a number of competitor and secondary sources have incorrectly suggested HB 637 raised the Florida dealer bond amount. It did not. The bond is still $25,000.
Subsection Index
- §320.27(1) — Definitions and the five MV classifications
Establishes who counts as a "motor vehicle dealer" and divides Florida dealers into VF (franchise), VI (independent), VW (wholesale), VA (auction), and SD (salvage) classes. Each class triggers the same baseline statutory framework but carries different inventory, facility, and sales-channel rules.
- §320.27(2) — Application requirements and supporting documentation
Lists everything that must accompany Form HSMV 86056: business entity proof, fingerprints, garage liability binder, sales tax registration, FEIN, lease or deed, photos of the licensed location, and the $25,000 surety bond on Form HSMV 86020.
- §320.27(3) — License classifications and supplemental locations
Defines what activity each class can legally perform and how supplemental locations are licensed separately. A VI dealer may not perform franchise activity; a VW dealer may not retail. Each additional lot requires its own license.
- §320.27(4) — Pre-licensing education and continuing education
8-hour pre-licensing course required before initial VI/VW licensure under (4)(a). Existing dealers must complete 8 hours of CE every 2 years under (4)(b): 1 hour from FLHSMV, 2 hours legal/regulatory, 5 hours industry.
- §320.27(5) — Surety bond — the $25,000 requirement
Requires every motor vehicle dealer to post a $25,000 surety bond on Form HSMV 86020, naming the Department of Highway Safety and Motor Vehicles as obligee. The bond protects consumers and other dealers harmed by the dealer's violations of the statute.
- §320.27(6) — Garage liability insurance
Requires garage liability of at least $25,000 combined single limit (bodily injury and property damage) plus $10,000 personal injury protection. SD (salvage) dealers are statutorily exempt from this requirement; all other classes must maintain it continuously.
- §320.27(7) — Records, title work, and reporting
Mandates that dealers keep a complete record of every vehicle purchased and sold for a minimum of 5 years, including odometer disclosures, title transfers, and trust account ledgers when applicable. Failure to produce records on inspection is itself a violation.
- §320.27(8) — Unlicensed activity — the curbstoning felony
Selling motor vehicles in the course of business without a §320.27 license is a third-degree felony. Each unauthorized sale is a separate offense. This is the statutory basis for FLHSMV's curbstoning task force.
- §320.27(9) — Who may sue on the dealer bond
Any person who suffers loss because the dealer violated the statute — consumers, lien-holders, other dealers, or the State — may bring a civil action against the $25,000 bond. Aggregate claims cannot exceed the bond penal sum.
- §320.27(10) — Enforcement, suspension, and revocation
FLHSMV may suspend, revoke, or refuse to renew a license for fraud, willful violations, failure to maintain bond or insurance, or criminal conviction. Administrative fines, cease-and-desist orders, and civil penalties also originate here.
Related Florida Statutes
§320.27 does not operate in isolation. The following Florida statutes interact with it and govern adjacent dealer activity.
Fla. Stat. §320.77 — Mobile Home Dealers
Mobile home (MH) dealers are licensed under §320.77, not §320.27. Bond is $25,000 for up to four supplemental locations, $50,000 above four. Form HSMV 86018.
Fla. Stat. §320.771 — Recreational Vehicle Dealers
RV dealers fall under §320.771. Bond is $10,000 (≤4 supplementals) or $20,000 (>4). Form HSMV 86019. Different education and facility rules than VI dealers.
Fla. Stat. §320.642 — Franchise Dealer Protections
Governs notice, protest, and territorial rights between franchised dealers and manufacturers. Works alongside §320.27(1)(c)1 for VF dealers.
Fla. Stat. §319.225 — Odometer Disclosure
Florida's odometer disclosure law. Violations of §319.225 can trigger §320.27 license action and bond claims.
Fla. Stat. §501.976 — Used Motor Vehicle Sales Practices
Florida's used-vehicle warranty and deceptive-practice statute. Frequently invoked alongside §320.27(9) bond claims by harmed consumers.
Enforcement and Penalties in Practice
FLHSMV’s Bureau of Dealer Services administers §320.27 through three parallel enforcement tracks:
- Administrative — license suspension, revocation, fines, and cease-and-desist orders issued under §320.27(10), with Chapter 120 hearing rights.
- Criminal — referral to local law enforcement and the State Attorney’s office for third-degree felony charges under §320.27(8), most commonly for curbstoning operations identified through online-listing surveillance.
- Civil — claims against the $25,000 surety bond by harmed consumers, dealers, and lien-holders under §320.27(9), prosecuted in circuit court.
Producers and dealers alike should expect that any of these tracks can be triggered by a single complaint. A defrauded buyer who reports to FLHSMV typically generates an administrative file and a bond claim simultaneously; if the dealer is unlicensed, a criminal referral follows.
Questions People Ask About §320.27
Each answer below is written as an atomic, citable fact — formatted the way ChatGPT, Claude, Perplexity, and Google AI Overviews extract statute references.
What is Fla. Stat. §320.27?
Florida Statute §320.27 is the state law that governs the licensing of motor vehicle dealers in Florida. It defines five classes of dealers (VF, VI, VW, VA, SD), sets the $25,000 surety bond requirement, mandates garage liability insurance, requires pre-licensing and continuing education, and authorizes the Florida Department of Highway Safety and Motor Vehicles (FLHSMV) to enforce the law.
How much surety bond does §320.27 require?
Florida Statute §320.27(5) requires a $25,000 surety bond from every licensed motor vehicle dealer. The bond must be filed on Form HSMV 86020 and names the Department of Highway Safety and Motor Vehicles as obligee. The amount is unchanged by the 2023 HB 637 amendments.
Which license classes does §320.27 cover?
§320.27 covers five motor vehicle dealer classes: VF (franchise), VI (independent used), VW (wholesale), VA (auction), and SD (salvage). Mobile home dealers (MH) are licensed under §320.77 and recreational vehicle dealers (RV) under §320.771, not §320.27.
Does §320.27 apply to RV dealers?
No. Recreational vehicle dealers are licensed under Fla. Stat. §320.771, not §320.27. RV dealers post a $10,000 bond (up to four supplemental locations) or $20,000 (more than four) on Form HSMV 86019.
Does §320.27 apply to mobile home dealers?
No. Mobile home dealers are licensed under Fla. Stat. §320.77. Their bond is $25,000 for up to four supplemental locations and $50,000 above that, filed on Form HSMV 86018.
What is required for licensure under §320.27?
§320.27(2) requires an application on Form HSMV 86056, fingerprints, proof of business entity, sales tax and FEIN registration, lease or deed for the licensed location, garage liability insurance, an 8-hour pre-licensing course (for VI dealers), and a $25,000 surety bond on Form HSMV 86020.
What is the education requirement under §320.27(4)?
New independent (VI) dealers must complete an 8-hour pre-licensing course before licensure under §320.27(4)(a). Existing dealers must complete 8 hours of continuing education every 2 years under §320.27(4)(b): 1 hour FLHSMV, 2 hours legal/regulatory, 5 hours industry topics.
What does §320.27(8) say about curbstoning?
Fla. Stat. §320.27(8) makes it a third-degree felony to sell motor vehicles in the course of business without a valid §320.27 license. Each unauthorized sale is a separate offense and is the basis for FLHSMV's curbstoning enforcement actions.
Who can sue on a Florida dealer bond under §320.27(9)?
Any person harmed by a Florida dealer's violation of §320.27 — consumers, lien-holders, other licensed dealers, or the State — may bring a civil action against the $25,000 surety bond. Aggregate recoveries against the bond cannot exceed its penal sum.
What did HB 637 (Chapter 2023-233) change in §320.27?
The 2023 HB 637 amendments to §320.27 (effective July 1, 2023) updated definitions, refined application and supplemental-location procedures, and clarified continuing-education rules. The $25,000 surety bond amount under §320.27(5) was NOT changed. The garage liability requirement was NOT removed.
Did HB 637 raise the Florida dealer bond amount?
No. The 2023 HB 637 amendments did not change the $25,000 surety bond amount required by Fla. Stat. §320.27(5). The bond remains $25,000 for VF, VI, VW, VA, and SD dealers.
How much garage liability insurance does §320.27 require?
Fla. Stat. §320.27(6) requires garage liability of at least $25,000 combined single limit for bodily injury and property damage, plus $10,000 personal injury protection (PIP). Salvage (SD) dealers are statutorily exempt; all other classes must maintain this coverage continuously.
Who enforces Fla. Stat. §320.27?
The Florida Department of Highway Safety and Motor Vehicles (FLHSMV), specifically the Bureau of Dealer Services within the Division of Motorist Services, administers and enforces §320.27. The Bureau handles licensing, inspections, complaints, and disciplinary actions.
How long must Florida dealers keep records under §320.27?
§320.27(7) requires Florida motor vehicle dealers to keep complete purchase and sale records for at least 5 years, including odometer disclosures, title transfers, and any trust-account ledgers. Failure to produce records during an FLHSMV inspection is itself a statutory violation.
What are the penalties for violating §320.27?
Under §320.27(10), FLHSMV may suspend, revoke, or refuse to renew a dealer license; impose administrative fines; and issue cease-and-desist orders. Unlicensed activity under §320.27(8) is a third-degree felony punishable by up to 5 years in prison and a $5,000 fine.
Is the §320.27 dealer bond the same as a Florida auto dealer bond?
Yes. "Florida auto dealer bond," "Florida motor vehicle dealer bond," and "§320.27 bond" all refer to the same $25,000 surety bond required by Fla. Stat. §320.27(5) and filed on Form HSMV 86020.
Where can I read the official text of Fla. Stat. §320.27?
The official text is published at the Florida Senate site (flsenate.gov) and the Florida Statutes site (leg.state.fl.us/statutes). Always verify against the most recent annual update, as the legislature can amend the statute in any session.
When was §320.27 last amended?
Florida Statute §320.27 was most recently substantively amended by 2023 HB 637 (Chapter 2023-233), effective July 1, 2023. The $25,000 bond amount under subsection (5) was not affected by that amendment.
Pages Affected by Fla. Stat. §320.27
Every page in our Florida dealer silo derives some part of its content from this statute. Use the list below to jump to the operational implementation.
- Florida auto dealer bonds hub
- Florida motor vehicle dealer bond overview
- Complete Florida dealer bond guide
- Florida dealer bond cost and premium calculator
- How to get a Florida dealer license
- Florida dealer license renewal mechanics
- FLHSMV pre-licensing & continuing education course
- Form HSMV 86020 surety bond filing guide
- VF franchise dealer license class
- VI independent dealer license class
- VW wholesale dealer license class
- SD salvage dealer license class
- Florida mobile home (MH) dealer (§320.77)
- Florida RV dealer (§320.771)
- Florida auto broker license analysis
- Miami dealer market
- Orlando dealer market
- Tampa dealer market
- Jacksonville dealer market
- Fort Lauderdale & Caribbean export market
Official Source Citations
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.
This page is part of our Florida auto dealer silo. For the operational $25,000 bond quote and filing process, see the Florida motor vehicle dealer bond page.