The Core Details of an RV Auto Dealer Surety Bond Explained

A Recreational Vehicle Dealer Bond (RV Dealer Surety Bond) is a type of automotive dealer bond, which guarantees that a dealer will carry on his business while obeying the laws of the state such as consumer protection and proper payment of taxes. A recreational vehicle is one which contains bedroom, kitchen, living room and a bathroom. Motorhomes, slide-in-campers also fall into this category. RVs are used for everything ranging from vacations to living. Many RVs serve as permanent traveling homes.

A RV Dealer Bond is a type of surety bond. Normally, a surety bond is signed between three parties. Surety bonds ensure that the concerned individual will abide by the laws of the state and in case of them failing to do so, the bond would have to pay out the damages to the buyer.

The three parties mentioned above are also known as the principal, surety and oblige. Here the primary party is the principal or, in this case, the dealer. The recreational vehicle buyer is the oblige as he receives the service. The surety bond looks to it the oblige is not exploited by the primary party. And the RV Dealer method makes sure that the RV dealer operates under the laws of the state. In simpler words, if in any way, the dealer does not obey the laws of the state, the dealer bond makes up for the cost. Contrary to common notion, a dealer bond protects the buyer and not the dealer. Associated to every dealer bond is a penalty amount. This amount is the maximum amount that the surety bond will be paying in a situation where the principal party has defaulted. Thus, the surety is protected against paying out a huge sum of money when the dealer fails to follow its obligations.

Similar to insurance, the dealer is required to pay a sum as a premium to the surety in exchange of protecting their customers. This amount depends upon the previous record of the dealer, and the risk that the surety bond will be undertaking in exchange. Recently cost have risen as bond holders have become stricter towards dealers. When a claim occurs, it is properly investigated and the obligated amount is paid by the surety only if the claim is genuine. This amount is paid to the buyer. The dealer must pay back the amount to the surety along with legal fees. A dealer loses his appeal for a bond if they encounter regular claims.
Interested dealers can instantly buy a dealer bond online from BondsExpress.com. This bond allows interested dealers to buy bonds without complication easily in as less as five minutes.
Renewal – When the license of a dealer is approaching renewal date, they are sent a renewal form from the Auto Industry Division. This form is sent approximately about a month before the renewal date. The license bond must be renewed before the last date positively, or it may lead to cancellation of the license. The dealer may be required to apply freshly for a dealer's license again. A stitch in time saves nine.