How to Get a Dealer License in California
In California, dealer licensing runs through the California DMV — Occupational Licensing (Vehicle Industry Services). To get a used car dealer license in California you'll need a registered business, a compliant location, a $50,000 surety bond, and the fees below. Whether you're opening a car lot, going wholesale-only, or starting a buy-here-pay-here operation, this guide walks the California auto dealer license requirements, real costs, and the exact steps — in plain English. Rules change, so verify everything against the California DMV — Occupational Licensing (Vehicle Industry Services)'s current pages before you file.
- Surety bond
- $50,000
- License term
- Typically a one-year term renewed annually through DMV Occupational Licensing, with continuing education required every two years — confirm the current term with DMV.
- Sales threshold
- Selling or offering for sale more than a handful of vehicles you don't hold for personal use in a 12-month period — or buying vehicles for the purpose of resale — requires a dealer license. California caps how many of your own personal vehicles you can sell per year before you're treated as a dealer; verify the current count with DMV.
- Pre-licensing
- Used-dealer and wholesale-only applicants must complete a DMV-approved dealer education program, then pass the DMV-administered used-dealer written exam (3 attempts; $16 per retake, one-week wait between tries). The original Certificate of Completion is submitted with the application, and continuing education is required at renewal.
License types in California
| License type | What it covers |
|---|---|
| Used Vehicle Dealer | Retail (and wholesale) sales of used vehicles from a licensed California location. Requires dealer education, exam, bond, and a DMV inspection. |
| Dealer — Wholesale Only | Dealer-to-dealer and dealer-auction sales only; may not sell to the retail public. Selling fewer than 25 vehicles a year can qualify for a reduced bond. |
| New Vehicle (Franchise) Dealer | New-vehicle sales under a manufacturer franchise — a separate track from a used-only license. |
| Autobroker (endorsement) | An endorsement on a dealer license that lets you arrange a retail sale between a buyer and another dealer. |
What it costs
| Item | Cost | Notes |
|---|---|---|
| Original application fee (OL 12) | $175 | Non-refundable, filed with the OL 12 application |
| Family Support Program fee | $1 | Paid with the application |
| Surety bond (face amount) | $50,000 | $10,000 for wholesale-only <25 vehicles/yr and motorcycle/ATV dealers; premium is a fraction of this |
| Dealer education course + used-dealer exam | Varies by provider | Private provider course fee; DMV-administered written exam, $16 per retake (3 attempts) |
| Dealer plates | $92 each | $94 each for motorcycle dealer plates, plus applicable county fees |
| Live Scan fingerprinting | Varies | DOJ/FBI processing plus the rolling fee charged by the Live Scan site (DMV 8016) |
| CDTFA seller's permit | No fee | Required resale permit from the CA Dept. of Tax and Fee Administration |
Step by step
- Form/register your business and obtain a CDTFA seller's (resale) permit and any local business license.
- Secure a compliant California business location that meets DMV premises rules (office, display area, sign, records on site).
- Complete a DMV-approved dealer education course and pass the DMV used-dealer written exam.
- Obtain the $50,000 surety bond (OL 25), or the $10,000 bond if you qualify for the reduced tier.
- Complete Live Scan fingerprinting (DMV 8016) for each owner listed.
- File the OL 12 application with the OL 248U used-dealer packet, certificate of completion, bond, and fees.
- Pass the DMV business-location inspection and enroll in the electronic Report of Sale / Temporary License Plate system.
Premises & temp tags
Location: An established, permanent place of business in California with a proper office, a display/vehicle-storage area, business records kept on site, and an exterior sign showing the dealership name in letters at least six inches high, readable from the street. A DMV inspector verifies the location before the license is issued; home-based used-retail lots rarely pass.
Temp tags / plates: California uses printed Temporary License Plates (TLPs), not paper temp tags. Since AB 516, dealers print a TLP and the Report of Sale — Used Vehicle (REG 51) at the point of sale through the DMV's electronic system (QuickTags). Handwritten Reports of Sale are no longer accepted; the TLP is valid up to 90 days or until permanent plates arrive.
California-specific things to know
- A wholesale-only license is cheaper to run and can use the $10,000 reduced bond, but you may not sell to a retail customer — a single retail sale off a wholesale license is a violation.
- The REG 262 (Vehicle/Vessel Transfer and Reassignment) is a secure, controlled form: it doubles as bill of sale, odometer disclosure, and power of attorney, and DMV rejects photocopies — original ink signatures only, and the odometer disclosure cannot be signed by power of attorney.
- California requires electronic reporting of every sale; you print the Report of Sale (REG 51) and Temporary License Plate through the DMV system rather than writing them by hand.
- Live Scan clearance and the dealer-education certificate must be complete before DMV will schedule the required business-location inspection.
Official California resources
California dealer license FAQ
How much does a dealer license cost in California?+
Original application fee (OL 12): $175; Family Support Program fee: $1; Surety bond (face amount): $50,000; Dealer education course + used-dealer exam: Varies by provider; Dealer plates: $92 each; Live Scan fingerprinting: Varies; CDTFA seller's permit: No fee. Plus the $50,000 surety bond (you pay a small annual premium on that, not the full amount).
How big is the dealer bond in California?+
California requires a $50,000 surety bond. Used and retail dealers post a $50,000 California Auto Dealer Bond (form OL 25) under Vehicle Code §11710. Wholesale-only dealers selling fewer than 25 vehicles a year, and motorcycle/all-terrain dealers, generally qualify for a reduced $10,000 bond — confirm your tier with DMV. The annual premium you pay is a fraction of the face amount, based on credit.
Do you need a physical lot to get a dealer license in California?+
An established, permanent place of business in California with a proper office, a display/vehicle-storage area, business records kept on site, and an exterior sign showing the dealership name in letters at least six inches high, readable from the street. A DMV inspector verifies the location before the license is issued; home-based used-retail lots rarely pass.
How many cars can you sell in California without a dealer license?+
Selling or offering for sale more than a handful of vehicles you don't hold for personal use in a 12-month period — or buying vehicles for the purpose of resale — requires a dealer license. California caps how many of your own personal vehicles you can sell per year before you're treated as a dealer; verify the current count with DMV.
How long is a California dealer license valid?+
Typically a one-year term renewed annually through DMV Occupational Licensing, with continuing education required every two years — confirm the current term with DMV.
Is dealer training or an exam required in California?+
Used-dealer and wholesale-only applicants must complete a DMV-approved dealer education program, then pass the DMV-administered used-dealer written exam (3 attempts; $16 per retake, one-week wait between tries). The original Certificate of Completion is submitted with the application, and continuing education is required at renewal.
How do temporary tags work for California dealers?+
California uses printed Temporary License Plates (TLPs), not paper temp tags. Since AB 516, dealers print a TLP and the Report of Sale — Used Vehicle (REG 51) at the point of sale through the DMV's electronic system (QuickTags). Handwritten Reports of Sale are no longer accepted; the TLP is valid up to 90 days or until permanent plates arrive.
Data verified 2026-07-17. Requirements change — confirm with the California DMV — Occupational Licensing (Vehicle Industry Services) before filing.
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