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By Jud Webre • April 7, 2017

5 Steps To Get A Car Dealer License In California

how to get a california dealer license


Are you looking to start your own car dealership in California?  Before you can start selling cars, the state requires you get a California Dealer License.

 

Not sure if you need a dealer license? Check out this post on selling cars without a license.

 

Short on time? Read our Motor Vehicle Dealer License FAQ

 

How to get a California Dealer License

 

Step #1: Complete a California Dealer License Application

 

For an overview of what forms are required, view the appropriate checklist:

 

Step #2: Undergo criminal background check (including Live Scan fingerprinting)

If you're not sure whether you are eligible for a California dealer license due to a previous conviction, the DMV allows you to file an abbreviated application. 

You'll still pay a $176 application fee, but the state will let you know whether it would grant you a license before you go to the trouble of setting up your business, obtaining a surety bond, etc.

 

If you are considering an abbreviated application, contact the Occupational Licensing Inspector in your area for assistance. 

 

Step #3: Purchase a California Motor Vehicle Dealer Bond

A California Motor Vehicle Dealer Bond is a type of surety bond that protects your customers from fraud or misrepresentation during a business sale. Think of it like insurance that you customers can make claims on. You can learn about the bond claim process here.

 

Not sure how to get a California Auto Dealer Bond? Use this interactive tool to help you out.

 

Bond amounts are set at:

  • New and used vehicle dealers: $50,000 bond
  • Motorcycle, ATV, wholesale-only dealers: $10,000 bond

 

You won't have to pay the full bond amount to get bonded. Depending on your credit score, you will likely pay 1-15% of the total bond amount.

This would be a one-time payment, not a monthly payment. You can see what you would pay for your bond by getting a free quote below:

 

 New/Used Dealer Bond Quote

-OR-

Wholesale/Motorcycle Dealer Bond Quote

 

Once you purchase your bond, the surety company will mail it to you.

 

Step #4: Meet other requirements

  • Provide proof of dealer education completion and pass written exam (only for used and wholesale dealers)
  • Provide a copy of your rental or lease agreement
  • Include signed and dated pictures of your business according to DMV requirements
  • Include copy of city and/or county business license, Certificate of Occupancy, or Tax Certificate
  • Copy of Board of Equalization Resale Permit

 

Step #5: Submit

Submit your paperwork to the California DMV and wait for approval.

You will need to include the following fees:

  • $175 initial license application fee
  • $1 Family Support Program fee
  • $100 Autobroker fee
  • $300 New Motor Vehicle Board fee
  • $71 / each dealer plate
 
 
It could take up to 120 days to process your CA Dealer License Application and run a background check.
 
The CA DMV lets you check your license status.
 
Your place of business will need to be inspected by an Occupational Licensing Inspector before you can be granted a California Dealer License. Information on inspection.
 

 

License Renewal and Expiration

California Dealer Licenses expire annually.

You should receive a renewal notice in the mail 90 days before your license expires. To renew your CA Dealer License, you need to complete and submit an Application for Renewal of License (Form OL 45). 

 

Every 2 years, you must also supply proof of continuing dealer education.

 
 
View our FREE EBOOK: "The Ultimate Guide To Car Dealer Licensing"