Tennessee Motor Vehicle Dealer Bond
Overview
Tennessee's Motor Vehicle Commission collects its dealer bond on a state-issued form, and that form leaves no ambiguity: the corporate surety bond must be at least $50,000, and a letter of credit is not an acceptable substitute. The requirement flows from Tennessee's motor vehicle dealer licensing law, T.C.A. section 55-17-111, and the executed bond — filed on the Commission's form IN-1316 — is a condition of obtaining and keeping a Tennessee dealer license.
Who Needs This Bond?
Applicants for a Tennessee motor vehicle dealer license through the Motor Vehicle Commission, part of the Department of Commerce and Insurance, file this bond — franchised new-car dealers, independent used-car dealers, and wholesale dealers alike. The Commission's bond form is executed with the dealer as principal and the State of Tennessee as the protected party, and it accompanies both original license applications and continued licensure.
What is this Bond For?
The bond guarantees the dealer's faithful compliance with Tennessee's motor vehicle dealer laws. If a licensed dealer's conduct in a vehicle transaction — such as failing to deliver good title or violating the licensing statutes — causes a financial loss, the bond gives the harmed party and the state a source of recovery up to the bond amount. The dealer remains liable to reimburse the surety for any claim paid, which is what makes the bond an accountability tool rather than dealer insurance.
When is it Required?
The executed IN-1316 bond must be on file with the Motor Vehicle Commission before your dealer license is issued, and coverage must remain continuous while you hold the license. Note Tennessee's firm stance on the instrument itself: the Commission requires a corporate surety bond and expressly does not accept a letter of credit in its place, so there is no bank-instrument alternative to arrange.
Where Does it Apply?
This is a statewide Tennessee requirement administered by the Tennessee Motor Vehicle Commission under the Department of Commerce and Insurance. It applies to licensed dealer locations across the state, because the obligation comes from T.C.A. section 55-17-111 and the Commission's licensing rules rather than any county or city ordinance.
How to Buy Online
Click 'Buy This Bond Online' on this page and the secure surety portal opens in a new tab. Complete the short application, review your bond documents, and pay securely in one session. Your executed Tennessee dealer bond is ready to file with the Motor Vehicle Commission as soon as you finish.
Why Bond Titan?
Bond Titan is powered by The Southern Agency, a licensed surety agency, and every requirement on this page is cited to Tennessee's official bond form and statute in the Official Sources section below — verify the rules yourself before you buy. The online flow gets your executed bond to you in time for your Commission filing.
Official Sources
The requirements described on this page are verified against the official sources below.
- Corporate surety bond of at least $50,000 required under T.C.A. §55-17-111; letter of credit not accepted; filed on Commission form IN-1316: Tennessee Motor Vehicle Commission — Dealer Surety Bond Form IN-1316 (verified July 16, 2026)