Motor Vehicle Dealer Bond in New Mexico

What this bond requires in New Mexico

New Mexico requires a $50,000 corporate surety bond for dealers, wholesalers, distributors, auto recyclers, and title service companies under NMSA 1978 § 66-4-7, with a reduced $12,500 bond for motorcycle-only dealers. The bond is continuous in form, payable to the State of New Mexico for the use and benefit of purchasers and their vendees, and covers losses from failure of title, fraudulent misrepresentations, or breach of warranty as to freedom from liens. The bond form must be approved by the New Mexico Attorney General, and the surety must be licensed by the New Mexico Public Regulation Commission.

Who requires it

The motor vehicle dealer bond is required by the New Mexico Taxation and Revenue Department, Motor Vehicle Division - Dealer Licensing Bureau under NMSA 1978 § 66-4-7.

How to file in New Mexico

Submit the MVD-10175 Vehicle Dealer or Auto Recycler Bond on the form approved by the Attorney General along with the dealer license application package to the MVD Dealer Licensing Bureau. The bond must be issued by a corporate surety licensed by the New Mexico Public Regulation Commission. Bond and license must remain in effect continuously; failure to maintain bond coverage results in license suspension or cancellation.

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FAQ

Common questions

Is a motor vehicle dealer bond required in New Mexico?

Yes. New Mexico requires motor vehicle dealer bonds issued by an admitted surety. The required amount is $12,500 to $50,000.

How much is the bond in New Mexico?

The bond amount is $12,500 to $50,000. Your annual premium is a small percentage of that, based on credit and experience.

Who requires the bond?

The bond is required by the New Mexico Taxation and Revenue Department, Motor Vehicle Division - Dealer Licensing Bureau.

How is the bond filed?

Submit the MVD-10175 Vehicle Dealer or Auto Recycler Bond on the form approved by the Attorney General along with the dealer license application package to the MVD Dealer Licensing Bureau. The bond must be issued by a corporate surety licensed by the New Mexico Public Regulation Commission. Bond and license must remain in effect continuously; failure to maintain bond coverage results in license suspension or cancellation.

What does the bond cover?

Surety bonds protect the obligee, not the principal. If you fail to meet the obligation the bond guarantees, the surety pays the claim and recovers from you.

Is a surety bond the same as insurance?

No. Insurance protects you. A surety bond protects whoever required the bond. You repay the surety for any claim they pay.