How to Get a Bonded Title in Colorado?

At Surety Bonds Agent, we offer a full range of surety bonds nationwide through an extended carrier network. Continue below to learn more about Colorado bonded titles. If you have additional questions or want to explore bonding solutions for your business, speak with one of our knowledgeable surety bond experts.

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What Is a Colorado Bonded Title?

Bonded titles are the solution for people who lack a standard title for a vehicle they have in their possession. The only difference between a bonded title and a standard title is that the former bears the “BONDED” brand. You can do anything with a bonded title that a standard title would allow you to do. 

Who Needs Them?

The most common reasons people give for needing a bonded title are:

  • They received a bill of sale and/or receipt from the seller, but no title.
  • They received a title considered deficient and invalid (e.g., fraudulently altered, improperly assigned, or damaged so as to be illegible).
  • They received a valid title, but it was lost or stolen before they were able to register the vehicle in their own name.

What Are the Steps in the Bonded Titling Process?

In Colorado, bonded titles are issued by the Department of Revenue’s Division of Motor Vehicles. To apply for a bonded title, you will need to:

  • Have a VIN inspection done by a Peace Officers Standards and Training (P.O.S.T.) certified inspector. 
  • Complete a Motor Vehicle Requestor Release Affidavit of Intended Use (DR 2489A).
  • Request a Colorado Title Record search. You must contact any prior title holder or lienholder revealed through the search and get confirmation that there is no current ownership claim or lien on the vehicle.
  • Determine the vehicle’s current market value from Kelly Blue Book, NADA, a licensed Colorado motor vehicle dealer, or other authoritative source.
  • Purchase a three-year Colorado title bond in an amount that is twice the vehicle’s appraised value.
  • Submit the application package to the local DMV.

Why is a Title Bond Required?

A Colorado title bond is your guarantee that you are the true owner of the vehicle for which you need a bonded title. It also guarantees that you (as the bond’s “principal”) will pay damages to any party that can prove their ownership of or lien against the vehicle during the three years that the bond is in force. Additionally, the bond indemnifies the Department of Revenue (known as the bond’s “obligee”) against responsibility for any damages resulting from having issued you a bonded title—damages incurred by the vehicle’s rightful owner or a lienholder and by anyone you may have sold the vehicle to after obtaining a bonded title.

How Do They Work?

There is a third party to a Colorado title bond in addition to the obligee and the principal. The bond’s guarantor is referred to as the “surety.” The surety will determine the legitimacy of any claim filed against the bond by an injured party.

Although the principal is legally obligated to pay all valid claims against their bond, the surety has guaranteed that payment and therefore typically pays a valid claim initially, to be reimbursed by the principal. The surety has a right to take legal action against the principal to recover the claim amount (plus court costs and legal fees) if the debt created by paying a claim on the principal’s behalf is not repaid.

What Do They Cost?

Colorado title bonds for $6,000 or less typically are sold for a flat premium as low as $100. That cost increases incrementally, generally by $10 for every additional $1,000 of coverage up to a bond amount of $25,000. Bonds for more than $25,000 go through an underwriting process that is based largely on the principal’s personal credit score. That’s the generally accepted measure of the risk the surety will be assuming in paying claims on behalf of the principal. The higher the principal’s credit score, the lower the risk to the surety, and vice versa. The lower the risk, the lower the premium rate. The average premium rate is between one and three percent, but someone with lesser credit may be assigned a higher rate.

At Surety Bonds Agent, we offer a full range of surety bonds nationwide through an extended carrier network. Continue below to learn more about Colorado bonded titles. If you have additional questions or want to explore bonding solutions for your business, speak with one of our knowledgeable surety bond experts.

CONTACT US FOR A

FREE BONDED TITLE QUOTE

What Are Bonded Titles?

Bonded titles are the solution for people who lack a standard title for a vehicle they have in their possession. The only difference between a bonded title and a standard title is that the former bears the “BONDED” brand. You can do anything with a bonded title that a standard title would allow you to do. 

The most common reasons people give for needing a bonded title are:

  • They received a bill of sale and/or receipt from the seller, but no title.
  • They received a title considered deficient and invalid (e.g., fraudulently altered, improperly assigned, or damaged so as to be illegible).
  • They received a valid title, but it was lost or stolen before they were able to register the vehicle in their own name.

In Colorado, bonded titles are issued by the Department of Revenue’s Division of Motor Vehicles. To apply for a bonded title, you will need to:

  • Have a VIN inspection done by a Peace Officers Standards and Training (P.O.S.T.) certified inspector. 
  • Complete a Motor Vehicle Requestor Release Affidavit of Intended Use (DR 2489A).
  • Request a Colorado Title Record search. You must contact any prior title holder or lienholder revealed through the search and get confirmation that there is no current ownership claim or lien on the vehicle.
  • Determine the vehicle’s current market value from Kelly Blue Book, NADA, a licensed Colorado motor vehicle dealer, or other authoritative source.
  • Purchase a three-year Colorado title bond in an amount that is twice the vehicle’s appraised value.
  • Submit the application package to the local DMV.

A Colorado title bond is your guarantee that you are the true owner of the vehicle for which you need a bonded title. It also guarantees that you (as the bond’s “principal”) will pay damages to any party that can prove their ownership of or lien against the vehicle during the three years that the bond is in force. Additionally, the bond indemnifies the Department of Revenue (known as the bond’s “obligee”) against responsibility for any damages resulting from having issued you a bonded title—damages incurred by the vehicle’s rightful owner or a lienholder and by anyone you may have sold the vehicle to after obtaining a bonded title.

There is a third party to a Colorado title bond in addition to the obligee and the principal. The bond’s guarantor is referred to as the “surety.” The surety will determine the legitimacy of any claim filed against the bond by an injured party.

Although the principal is legally obligated to pay all valid claims against their bond, the surety has guaranteed that payment and therefore typically pays a valid claim initially, to be reimbursed by the principal. The surety has a right to take legal action against the principal to recover the claim amount (plus court costs and legal fees) if the debt created by paying a claim on the principal’s behalf is not repaid.

Colorado title bonds for $6,000 or less typically are sold for a flat premium as low as $100. That cost increases incrementally, generally by $10 for every additional $1,000 of coverage up to a bond amount of $25,000. Bonds for more than $25,000 go through an underwriting process that is based largely on the principal’s personal credit score. That’s the generally accepted measure of the risk the surety will be assuming in paying claims on behalf of the principal. The higher the principal’s credit score, the lower the risk to the surety, and vice versa. The lower the risk, the lower the premium rate. The average premium rate is between one and three percent, but someone with lesser credit may be assigned a higher rate.

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Request a quote online or call today to speak with one of our surety bond agents about getting you a good rate on the bonded title you need to do business in your state.