Motor Vehicle Dealers - Used Vehicles Only
Required for used motor vehicle dealers in Texas to obtain and maintain their dealer license. Protects consumers and the state from fraudulent business practices.
Trusted by thousands · Easy online process · Quick turnaroundRates and requirements last updated June 26, 2026
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About This Bond
The Motor Vehicle Dealer's Surety Bond is a financial guarantee required by the State of Texas for businesses engaged in buying and selling used motor vehicles. This bond ensures that dealers comply with state regulations and conduct business in an ethical manner.
Who Needs This Bond: Used motor vehicle dealers operating in Texas must obtain this bond as part of their licensing requirements. Each dealership location requires a separate bond, and all lot addresses must be specifically listed on the bond form. Dealers operating in multiple cities need separate licenses and bonds for each city.
Protection and Coverage: The $50,000 bond protects consumers and the state against financial losses resulting from the dealer's failure to comply with applicable laws and regulations. This includes protection against fraudulent practices, failure to transfer titles properly, or other violations of motor vehicle dealer regulations.
Bond Terms: This bond has a 2-year term and must be effective on the first day of a month, expiring at the end of the month two years later. The bond is renewable upon expiration. Texas requires an embossed seal on all Power of Attorney documents - sticker seals are not acceptable.
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At a glance
Texas Auto Dealer Bond Key Facts
Governed by Tex. Transp. Code § 501.053.
The basics
What Is an Auto Dealer Bond in Texas?
A bonded title in Texas is a regular vehicle title the Texas Department of Motor Vehicles (TxDMV) issues on the strength of a surety bond. You use it when you cannot get the normal proof of ownership — for example, the title is lost and the seller cannot provide one — and the vehicle is in your possession. Texas law calls this filing a bond under Transportation Code § 501.053.
Good to know - There is no minimum vehicle value to require a bond — the surety bond is the standard path. For vehicles 25 years or older that appraise under $4,000, the value used to set the bond is $4,000.
The bond protects the TxDMV and any future owner or lienholder if someone else turns out to have a claim on the vehicle. You file it together with your title application — it does not replace the application.
Texas sets the bond at 1.5 times your vehicle’s value, and the bond stays in effect for three years. If no one makes a valid claim during that time, the bond ends and you keep a clear title.
A bonded title is not the only path. If you cannot qualify for a bond — for example, you cannot clear a lien that is less than 10 years old — Texas also allows a tax assessor-collector hearing or a court order to establish ownership.
Qualification
What You Need to Qualify for a Texas Auto Dealer Bond
Approval depends on your dealer license type, required coverage amount, and underwriting factors such as credit.
- You are a Texas resident, or military personnel stationed in Texas.
- The vehicle is in your possession.
- The vehicle is complete — it has a frame, body, and motor (a motorcycle needs a frame and motor).
- The vehicle is not junked, nonrepairable, or otherwise ineligible for a title.
- There is no lien on the vehicle, any lien is at least 10 years old, or you have a release of lien or letter of no interest for any lien less than 10 years old.
Step by step
How to Get an Auto Dealer Bond in Texas: Step by Step
Confirm you qualify
Check that you are a Texas resident (or military stationed in Texas), the vehicle is in your possession and complete, and any lien is resolved. You cannot get a bonded title if you cannot clear a lien that is less than 10 years old.
Apply for a determination
Submit the Bonded Title Application (Form VTR-130-SOF), a copy of your photo ID, and the $15 fee to the TxDMV Regional Service Center that serves your county, in person or by mail.
Bonded Title Application or Tax Collector Hearing Statement of Fact (VTR-130-SOF)Get your Notice of Determination and bond amount
If approved, the TxDMV issues a Notice of Determination (Form VTR-130-ND) showing the bond amount you must buy, equal to 1.5x the vehicle’s value. Value comes from the Standard Presumptive Value, then NADA, then a licensed appraisal on Form VTR-125 if neither is available. Enter your value in the calculator above to estimate your premium.
Motor Vehicle Appraisal for Tax Collector Hearing / Bonded Title (VTR-125)Buy your surety bond
Take the Notice of Determination to an insurance agency or any agency licensed to sell vehicle surety bonds in Texas and buy a bond for the amount on the notice. Once issued, the bond stays in effect for three years.
File your title application at the county tax office
Within 30 days of buying the bond, take the original Notice of Determination, the surety bond, the Application for Texas Title and/or Registration (Form 130-U), your ID, and any required documents to your county tax assessor-collector office, and pay the title and registration fees.
Application for Texas Title and/or Registration (130-U)Paperwork
Texas Dealer Bond Forms & Documents
Filed with the TxDMV Regional Service Center to start the process.
View formIssued by the TxDMV with your required bond amount (not a downloadable form).
Sets the vehicle value only when no SPV or NADA value is available.
View formThe main title/registration application, filed at the county tax office.
View formCompleted by an authorized inspector when a VIN inspection is required.
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Cost
How Texas Auto Dealer Bond Pricing Works
You do not pay the full bond amount. In Texas, the surety bond must equal 1.5 times your vehicle’s value. You pay a premium, which is a smaller percentage of that bond amount.
Your premium depends on the bond amount and underwriting. Use the calculator above for an estimate; your final premium may vary. The $15 TxDMV application fee and your county’s title and registration fees are separate from the bond premium.
Worked example
If your vehicle’s value is $8,000, the bond amount is 1.5x that, or $12,000. You pay only the premium on the $12,000 bond, not the full $12,000.
Filing
Filing Information
Texas Department of Motor Vehicles (TxDMV)
We prepare the issued bond and send you a copy for your records. Filing requirements vary by state, license type, carrier, and bond form.
1-888-368-4689FAQ
Texas Auto Dealer Bond FAQ
Yes. Texas issues a title backed by a surety bond under Transportation Code § 501.053 when you cannot get the normal ownership documents and the vehicle is in your possession.
The bond amount is 1.5 times your vehicle’s value. You pay a premium — a percentage of that amount — not the full bond amount. Use the calculator above to estimate it.
The TxDMV uses the Standard Presumptive Value (SPV); if there is no SPV, a NADA value; if neither is available, a licensed dealer or insurance adjuster appraisal on Form VTR-125. For vehicles 25 years or older that appraise under $4,000, the value is set at $4,000.
Three years. Under Transportation Code § 501.053, the bond expires on the third anniversary of the date it became effective.
Start at the TxDMV Regional Service Center that serves your county with Form VTR-130-SOF, your ID, and the $15 fee. After you buy the bond, file your title application at your county tax assessor-collector office.
A bonded title will not be issued on a vehicle with a lien less than 10 years old unless you provide a release of lien or a letter of no interest from the recorded lienholder. Liens 10 years or older do not block a bonded title.
One year from the date on your Notice of Determination (Form VTR-130-ND). After you buy the bond, file your title application at the county tax office within 30 days.
Sources
Last verified 2026-06-23. Requirements change - confirm current details with Texas Department of Motor Vehicles (TxDMV) before you file. This page is informational and not legal advice.
FAQ
Texas Auto Dealer Bond Questions
The cost of a Texas auto dealer bond is usually a small percentage of the state-required bond amount. Your exact premium depends on the bond amount, license type, business details, and underwriting factors such as credit.
Many auto dealer bonds can be issued the same day after you complete the application. Larger bond amounts or applications that need underwriting review may take longer.
Requirements vary by license type, but most Texas auto dealers need to complete a short application and purchase the bond amount required by the state before their license can be issued or renewed.
Often, yes. Many states have separate bond requirements for wholesale, retail, broker, or other dealer license types. Choose the bond that matches your Texas license instructions.
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AutoDealersBond.com is operated by Insurance Services by Shield, a California and Texas licensed insurance agency (CA License #6018195, TX License #3446536). Insurance Services by Shield is not an insurance carrier and does not underwrite bonds or insurance policies. Bond and coverage availability, pricing, and issuance are subject to carrier underwriting approval, eligibility, applicable state requirements, and policy or bond terms. Availability varies by state.
