Frequently Asked Questions

How long does it take to get a dealer license?

Many students complete the process and get their dealer license within weeks of taking the course. However, this is not a requirement. The DMV gives you a year from the date you complete the course to submit your license application. If a year passes from your course date and you are not ready to submit your application, you will need to retake Pre-Licensing for an updated certification.

What are the advantages to having a dealer license?

1. Access to dealer-only vehicle auctions
2. Purchasing vehicles at wholesale dealer prices.
3. Purchasing vehicles with auction company financing.
4. Paying no sales tax on your vehicle purchases.
5. Paying no registration fees on your vehicle purchases.
6. Using dealer plates to drive vehicles without registering them.
7. Making money doing what you enjoy.
8. Writing off your expenses.
9. Saving significant money purchasing vehicles for yourself, friends and family.
10. Selling locally or exporting vehicles to other countries.
11. Purchasing cars at auction, then selling them via EBay, Craigslist or through your own company website.
12. Brokering vehicles without investing your own money.
13.Driving a vehicle you enjoy, then selling it at a profit in the future.
14. This is important – not getting caught selling a vehicle without a license, which can cause you to be barred from obtaining a license in the future.

What is the difference between a Wholesale and Retail license?

How do I get a dealer license without a lot?

Wholesale

A wholesale dealer license allows you to buy from private parties, at the dealer auctions, and from other dealers directly. Wholesale dealers can sell to other dealers, and they can sell/export vehicles to foreign countries. Wholesale dealers cannot sell directly to the public.

There are some additional wholesale dealer sales options and business models which we cover in class. To get your wholesale dealer license DMV requires an office. There is no sign nor display area requirement for wholesale. Wholesale dealers can obtain dealer plates.

A home office can, in some cases, qualify as a location for a wholesale dealer license.

(a wholesale office in a home or residential unit is okay if: the office is on the ground floor with a direct entrance from the outside / the office is used exclusively for the dealership business and not shared with personal space in the home / your local town, city, county planning department will issue a business license for your business at your home address)

Retail

A retail dealer license allows you to buy from private parties, at the dealer auctions, and from other dealers directly. Retail dealers can sell to other dealers and to the general public. They can also sell/export vehicles to foreign countries, and they can broker sales to the public with the Auto Broker Endorsement.

The DMV requires retail dealers to have an office, a two foot square sign, and a vehicle display area big enough for at least two vehicles. The display area requirement does not mean you need to have a lot, as long as it is clearly for the exclusive use of the dealer it can be inside, outside, and as minimal as two parking spots in front of your office designated with signage and on your lease etc. There are many display area options which we cover in detail in Pre-Licensing. Retail dealers can obtain dealer plates.

How do I become an Auto Broker?

Broker

The Auto Broker Endorsement (which is an add-on to retail dealer licenses) allows you to arrange the sale of vehicles owned by others and get paid for it. Brokers don’t actually own vehicles. They merely arrange a sale between a buyer and a seller. The broker can act on behalf of the seller, helping them sell their vehicle. They can also assist buyers with finding and purchasing vehicles. Brokers are sometimes also called “Auto Buying Services.” Brokers can charge the buyer, the seller, or both for their services. You can get the Auto Broker Endorsement from the DMV with your retail dealer license for an additional $100.00. Only licensed retail dealers can get the Auto Broker Endorsement. The Auto Broker Endorsement has several nice advantages. It provides dealers getting started a way to buy and sell vehicles without having to invest their own money in the vehicles. The paperwork you fill out when brokering is also quite simple. There are a number of further advantages to brokering which we will cover in class.

What tests do I need to take to get my dealer license?

The DMV requires you to pass two tests with a score of 70% to get your dealer license. One you take during Pre-Licensing, and the other one you will take at your local DMV Inspector’s office. The tests are very similar and cover the exact same material. So why do you have to take two? The first test you take with us to make sure you understand the basics of setting up and operating your dealership. The second test you will take at your local DMV Inspector’s office to prove to them you did attend a certified class and that you know the basics.