Fargo Secondhand Dealer Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain a Fargo Secondhand Dealer bond.
At a Glance:
- Average Cost: $100 per year or $10 per month
- Bond Amount: $5,000
- Who Needs it: All secondhand dealers operating in Fargo, North Dakota
- Purpose: To protect the public from financial harm if the secondhand dealer violates the terms of their license
- Who Regulates Secondhand Dealers in Fargo: The City of Fargo Licensing and Permit Department
Fargo Code of Ordinances 25-3502 requires all secondhand dealers operating in the city to obtain a license from the Licensing and Permit Department. The Fargo City Commission enacted the licensing requirement to ensure that secondhand dealers engage in ethical business practices. To provide financial security for the enforcement of the licensing law, secondhand dealers must purchase and maintain a $5,000 surety bond to be eligible for licensure.
What is the Purpose of the Fargo Secondhand Dealer Bond?
Fargo requires secondhand dealers to purchase a surety bond as part of the application process to obtain a business license. The bond protects the public from financial harm if the secondhand dealer fails to comply with the regulations set forth in Fargo Code of Ordinances 25-3504. Specifically, the bond protects the public if the secondhand dealer engages in any acts of fraud or breaches consumer contracts. In short, the bond is a type of insurance that protects the public if the secondhand dealer violates the terms of their license.
How Can an Insurance Agent Obtain a Fargo Secondhand Dealer Surety Bond?
BondExchange makes obtaining a Fargo Secondhand Dealer surety bond easy. Simply login to your account and use our keyword search to find the “Secondhand Dealer” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email or chat from 7:30 AM to 7:00 PM EST to assist you.
At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.
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Is a Credit Check Required for the Fargo Secondhand Dealer Bond?
No, a credit check is not required for the Fargo Secondhand Dealer bond. Because the bond is considered relatively low risk, the same low rate is offered to all secondhand dealers in the city regardless of their credit history.
How Much Does the Fargo Secondhand Dealer Bond Cost?
The Fargo Secondhand Dealer bond costs just $100 per year or $10 per month.
Who is Required to Purchase the Bond?
Fargo requires secondhand dealers to purchase a surety bond as a prerequisite to obtaining a business license. Secondhand dealers must obtain a separate license for each place of business they plan to operate. To paraphrase Fargo Code of Ordinances 25-3501, a secondhand dealer is a person who purchases or collects personal property of any type from a person who is not a wholesaler, for the purpose of reselling or exchanging the property.
Exemptions to this definition include:
- Garage sales
- Motor vehicle sales
- Nonprofits or charitable organizations
- Sales by licensed auctioneers
- Sales of secondhand books or magazines, antiques, used furniture or used clothing
BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How Do Secondhand Dealers Apply for a License in Fargo?
Secondhand dealers in Fargo must navigate several steps to obtain a license. Below are the general guidelines, but applicants should visit the Licensing and Permit Department’s website for details on the process.
License Period – All Fargo Secondhand Goods Dealer Licenses expire on December 31 of each year and must be renewed before the expiration date.
Step 1 – Purchase a Surety Bond
Secondhand dealers must purchase and maintain a $5,000 surety bond.
Step 2 – Complete the Application
225 4th St Street North
Fargo, ND 58102
Applicants must complete the form in its entirety and submit the following items:
- $250 license fee
- $250 one-time investigation fee
- Proof of liability insurance
- Three references
- Surety bond
Secondhand dealers must get their application notarized by a commissioned notary public, and all first-time applicants will be subject to a background check. Contact the Licensing and Permit Department for assistance with the application process.
How do Fargo Secondhand Dealers Renew Their Licenses?
Secondhand dealers should contact the Licensing and Permit Department to obtain a renewal application before their license expires. All Fargo Secondhand Goods Dealer Licenses expire on December 31 of each year and must be renewed before the expiration date.
What are the Insurance Requirements for Fargo Secondhand Dealers?
Fargo requires all businesses to obtain liability insurance coverage as a prerequisite to obtaining a business license (limits not specified). Secondhand dealers must also purchase and maintain a $5,000 surety bond.
How Do Fargo Secondhand Dealers File Their Bonds?
Secondhand dealers should mail or deliver their completed bond forms, including the power of attorney, to the Licensing and Permit Department at the following address:
225 4th St Street North
Fargo, ND 58102
The bond requires signatures, including witness signatures, from both the surety company that issues the bond and the applicant. The surety company should include the following information on the bond form:
- Legal name of the entity/individual(s) buying the bond
- Surety company’s name
- Date the bond goes into effect and expires
- Date the bond is signed
- Notary acknowledgments
What Can Fargo Secondhand Dealers do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, secondhand dealers in Fargo must ensure that they:
- Do not engage in any acts of fraud
- Do not breach contracts made with consumers
- Accurately represent all goods up for sale
What Other Insurance Products Can Agents Offer Secondhand Dealers in Fargo?
Fargo does not require secondhand dealers to purchase liability insurance. However, most reputable businesses will purchase this insurance anyway. Bonds are our only business at BondExchange, so we do not issue any other types of insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for Fargo Secondhand Dealer Customers?
Fargo unfortunately does not provide a public database of active secondhand dealers in the city. We suggest contacting the Licensing and Permit Department to obtain this information. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.