Difference between revisions of "Get a Used Car Dealers License"

#Decide what type of license you need. In many states, the application process and the license you obtain may vary based on the kind of vehicle that you wish to sell. Some options that you may have to consider cover a wide range:<ref name="rf1">http://publicsafety.ohio.gov/links/bmv4320.pdf</ref><ref name="rf2">http://www.mva.maryland.gov/about-mva/info/27100/27100-12T.htm</ref>

#Study your state’s application process. The application process alone for obtaining a car dealer’s license is extensive.<ref name="rf3">http://www.dmv.org/articles/how-to-obtain-a-business-license-as-an-auto-dealer/</ref> Some states, such as Texas or California for example, publish a car dealer manual that explains the business of car sales, as well as the application process. Find out from your state’s Department of Motor Vehicles if such a guide is available, and then take the time to study it.

#Prepare your establishment. In many states, as part of your application, you must already have an established business location. For example, in Washington, you are required to have an enclosed building, with a fixed, permanent, exterior sign, a phone number listed in directory assistance, and minimum business hours for at least five days a week.<ref name="rf4">http://www.dol.wa.gov/business/vehiclevesseldealer/dlrdealer.html</ref> New Jersey adds particular requirements that you must be able to demonstrate that you have a desk, chair, landline telephone, and a safe for storing documents.<ref name="rf5">http://www.state.nj.us/mvcbiz/BusinessServices/UsedNew.htm</ref> Indiana sets requirements on the square footage space that you need for displaying vehicles.<ref name="rf6">http://www.in.gov/sos/dealer/2572.htm</ref> You will need to research the minimum requirements for your state so that your location is ready when you apply.

#*Zoning Approval Form (Maryland<ref name="rf7">http://www.mva.maryland.gov/about-mva/info/27100/27100-02T.htm#Issue_New</ref>)

#*Sales Tax Certificate of Authority (New Jersey<ref name="rf5" />)

#*Corporate filings from the Secretary of State, if applicable to the business (Ohio<ref name="rf1" />)

#*Child Support Certification Form (New York<ref name="rf8">http://www1.nyc.gov/site/dca/businesses/license-checklist-secondhand-dealer-auto.page</ref>)

#Take care of insurance and bonding. In most states, in order to operate as a car dealer and obtain a license, you must show that you are adequately insured. The insurance is to protect the business from loss related to the inventory, and also to protect individuals from accident while they are on your property. Each state sets its own limits and requirements for insurance amounts.<ref name="rf3" />

#Prepare the necessary fees. Each state has its own system of fees that go along with submitting and obtaining a dealer’s license. In some cases, such as New York, the fee is a set amount.<ref name="rf8" /> In other states, like Ohio for example,<ref name="rf1" /> the fee may vary depending on the size of the business you intend to operate.

#Obtain the necessary background check. In many cases, along with your application, you will have to submit a criminal background records check. In some states, this will include fingerprinting and reference checks. These processes can take some time, so begin working on this well before you wish to submit your application.<ref name="rf3" />

#*A useful reference site is DMV.org. Although this site is not connected officially to any state’s department of motor vehicles, DMV.org does have links to most of the official forms from all 50 states.<ref name="rf9">http://www.dmv.org/buy-sell/car-dealers/dealer-forms.php</ref>

#Cooperate and participate in the review process. Once you submit your application and the accompanying materials, your application will be assigned to a licensing agent for review. That person will look through your entire package for completeness and accuracy. There may even be a site inspection to your business location. It is in your best interest to cooperate with this process to assure that it goes smoothly. Keep in mind that it can take several weeks to complete the application process before your license is issued.<ref name="rf3" />

#Renew your license as required. You will need to make sure that your license is current at all times. This will usually require a renewal application (much simpler than the original process) and payment of a renewal fee. For example, Florida allows you to pay a $75 fee and renew each year, or opt for a two-year license and pay a $150 fee.<ref name="rf10">https://www.flhsmv.gov/dmv/forms/BFO/86720.pdf</ref> Connecticut allows you to renew online, using a credit card to pay the fee.<ref name="rf11">http://www.ct.gov/dmv/cwp/view.asp?a=4142&q=486132</ref>

#Avoid violations. It is important that you continue to comply with your state’s expectations in operating your business or you could lose your license at any time. For example, the New Jersey Motor Vehicle Commission publishes a list of violations that could lead to suspension or revocation.<ref name="rf5" /> Some of the things to avoid are selling from additional non-licensed locations, failing to maintain records, failing to report accurate sales and tax information, and misuse of dealer plates.