VS-3 Form – The VS-3 Form is the official Dealer Bond Under New York State Vehicle and Traffic Law Section 415(6-b) required by the New York Department of Motor Vehicles (DMV) for most motor vehicle dealers. This surety bond ensures compliance with state regulations, protects consumers and financial institutions, and is a mandatory part of obtaining or renewing a dealer registration certificate.
Whether you’re opening a new dealership, renewing your registration, or transitioning from used to franchised sales, understanding the VS-3 form is essential. Below is a comprehensive, up-to-date guide based on official NY DMV resources and Vehicle and Traffic Law §415. Download the current VS-3 PDF directly from the DMV here: https://dmv.ny.gov/forms/vs3.pdf.
What Is the VS-3 Form?
The VS-3 Form is the standardized surety bond document titled “Dealer Bond Under New York State Vehicle and Traffic Law Section 415(6-b)”. It is executed by an approved surety company (not the DMV) on behalf of the dealer (principal) and binds the surety and dealer to the State of New York.
This one-page form includes:
- Dealer name and full business address
- Surety company details
- Bond number and amount
- Facility number (if applicable)
- Signatures and seals from both principal and surety
The bond remains in effect until the surety provides 60 days’ written notice of cancellation to the NY DMV Commissioner.
Why Is the Dealer Bond Required Under Vehicle and Traffic Law §415?
New York Vehicle and Traffic Law §415(6-b) mandates the bond as a condition for issuing a dealer registration certificate. It protects the public by guaranteeing that dealers fulfill key obligations, such as honoring payment drafts, transferring clear title, safeguarding customer deposits, paying DMV-imposed fines, and refunding any overcharges for registration or titling fees.
Recovery on the bond is available to any person (including the State) who obtains a judgment for a breach during the bond term. Liability is capped at the bond’s face amount, regardless of the number of claims.
This requirement, part of Article 16 of the Vehicle and Traffic Law, applies to dealers, qualified dealers, and new motor vehicle dealers engaging in the purchase, sale, or dealing of motor vehicles in New York.
Who Needs to File the VS-3 Dealer Bond?
All applicants for a motor vehicle dealer registration certificate under §415 must file the VS-3 bond unless exempt. This includes:
- Retail and wholesale used vehicle dealers
- New/franchised motor vehicle dealers
- Qualified dealers
The bond must accompany your original Facility Application (Form VS-1 or VS-1D/VS-1DI) and be submitted to the NY DMV Bureau of Consumer and Facility Services. The business name and mailing address on the bond must exactly match your application.
Current Bond Amounts for New York Dealers (2026)
Bond amounts are determined by your dealership type and prior-year sales volume (or anticipated volume for new applicants):
- $20,000 — Retail or wholesale used motor vehicle dealers that sold (or anticipate selling) 50 or fewer vehicles in the previous calendar year.
- $100,000 — Retail or wholesale used motor vehicle dealers that sold more than 50 vehicles in the previous calendar year.
- $50,000 — New motor vehicle dealers and qualified dealers (typically franchised dealers selling passenger cars, SUVs, light trucks, etc.).
These amounts have been stable since the 2017 updates to §415 and remain current. The bond must be continuous and filed with the DMV before registration is issued.
Exemptions from the Dealer Bond Requirement
You do not need to file a VS-3 bond if your dealership exclusively sells or deals in:
- Tow trucks, buses, school buses, or garbage trucks
- Marine trailers, recreational vehicles, or mobile homes
- Motorcycles, snowmobiles, or trailers
- Construction equipment
- Vehicles over 10,000 pounds GVWR (or those not commonly classified as passenger vehicles, SUVs, or light trucks)
In these cases, provide a written and signed statement specifying the vehicle types you intend to deal in exclusively.
How to Complete and Submit the VS-3 Form?
- Contact a NY DMV-authorized surety insurance company licensed by the Department of Financial Services.
- Provide your exact business name, full dealer address, and anticipated sales volume to determine the correct bond amount.
- The surety completes and signs the VS-3 Form, affixes its corporate seal, and attaches the required Power of Attorney papers.
- Submit the original sealed and signed VS-3 (copies are accepted in most cases) with your dealer application package.
Important: The DMV does not sell or issue surety bonds—you must obtain one through a private surety provider.
Step-by-Step Guide to Obtaining Your NY Dealer Bond
- Determine your bond amount based on sales volume and dealership type.
- Gather your dealer application documents (VS-1, proof of business location, tax ID, etc.).
- Apply for the bond through an approved surety (premiums are typically a small percentage of the bond amount and based on credit).
- Receive the executed VS-3 with seal and Power of Attorney.
- Include it in your DMV submission package.
- Once approved, your bond stays active; monitor the 60-day cancellation notice requirement.
Download the VS-3 Form PDF
Official Download:
VS-3: Dealer Bond Under New York State Vehicle and Traffic Law Section 415 (6-b) (PDF)
The form is version VS-3 (3/17) and includes clear instructions within the document.
Frequently Asked Questions About the VS-3 Form
Can I use a copy of the VS-3?
Yes—copies are accepted as long as the original was properly executed with seal and Power of Attorney.
What happens if my bond is canceled?
The surety must notify the DMV Commissioner 60 days in advance by first-class mail, plus additional notice on the cancellation date. Failure to maintain the bond can lead to registration suspension.
Is the bond required for renewal?
Yes—the bond must remain in effect continuously as a condition of registration.
Do transporters or dismantlers need the VS-3?
No—different requirements apply; check VS-142 for full dealer/transporter rules.
Importance of the Dealer Bond for Consumer Protection
The VS-3 bond safeguards buyers from issues like bounced drafts, undelivered titles, lost deposits, or improper fees. It also ensures dealers pay fines and comply with DMV rules, promoting trust in New York’s automotive marketplace.
For the most current details, always refer to the official NY DMV website (dmv.ny.gov) and Vehicle and Traffic Law §415.
Ready to apply? Download the VS-3 PDF today and contact an authorized surety provider to secure your dealer bond. Proper compliance with the VS-3 Form and §415 requirements will help you launch or maintain a successful, fully licensed dealership in New York State.