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4 Steps To Get Your Florida Auto Dealer License

4 Steps To Get Your Florida Auto Dealer License

Florida is one of the most populous states and growing fast. The outlook for used, recreational, and mobile home dealers is high and the market is growing. Getting your independent, recreational dealer license in Florida is a straightforward process, but there are some requirements that may be new to you if this is your first time getting licensed.

This article will outline:

  • The pre-licensing checklist to make getting your application filled out easy
  • The main licensing requirements you must complete for a complete application checklist
  • How to save money on the surety bond requirement
  • Establishing and meeting your dealership location requirements
  • Plus all the documents you need for application approval

Florida Auto Dealer Pre-Licensing Checklist

The pre-licensing checklist is to get your FEIN number, your sales tax number, complete the dealer class requirement, and register to get your fingerprints done.

This is outline on the Florida Department of Highway Safety And Motor Vehicles website with links to all of the necessary forms.

Step 1: Get FEIN Number

Register on the Internal Revenue Service's website to obtain a FEIN or Federal Employee Identification Number for your business. You will need an FEIN number even if you're a sole proprietor.

Click here to register as a business entity

Click here to register as a sole proprietorship

Step 2: Get Sales Tax Number

Register with the Florida Department of Revenue. You can create an account on their website and electronically fill out the Business Tax Application or you can print and fill out the physical application.

You want Form DR-1. You will need your EIN number before registering to get your sales tax number.

This number allows you to collect the necessary sales tax for vehicles and any other merchandise sold in your dealership.

Step 3: Complete the Pre-Licensing Dealer Class Requirement

This is an exam that includes training in:

  • Titling and registering motor vehicles and recreational vehicles
  • The laws related to unfair and deceptive trade practices
  • The laws related to financing regarding buy-here/pay-here operations
  • How to provide good business practices as determined by the FLHSMV

This exam must be issued from a FLHSMV approved training school. The provide a list on their website, at the bottom of this page.

These same schools provide the required continuing education exams required to keep your license active.

Step 4: Electronic Fingerprints

You and all owners/members of the business entity must complete the fingerprint requirement. This is conducted through a Florida Department of Law Enforcement approved service provider.

The fee is $24 per person and when you complete this, you'll be provided with a receipt you can submit with your application.

4 Step Florida Auto Dealer License Application Checklist

The application checklist is to complete the application, purchase the surety bond, purchase the required liability insurance, and mean all of the location requirements.

Step 1 - Complete the Application

From the pre-licensing checklist you should have most of the information required to complete the application.

There is additional documentation needed for a few steps on the application and to submit the final application packet. This is what the following steps will cover.

A few of the main parts of the application include:

  • Listing all owner information
  • Providing your business entity information
  • Outlining the dealership organizational structure

Make sure you use the full legal names for all owners and that the names for your business and any DBA (doing business as) names exactly match those registered with the Florida Division of Corporations.

Here are the application fees:

License Classification License Fee
Franchised Vehicle Dealer $300
Franchised Service Facility $300
Independent Vehicle Dealer $300
Wholesale Vehicle Dealer $300
Auction Vehicle Dealer $300
Salvaged Vehicle Dealer $300
Mobile Home Dealer $340
Mobile Home Broker $340
Recreational Vehicle Dealer $340
Recreational Vehicle Dealer $340

Step 2 - Auto Dealer Surety Bond Requirement

Every license in Florida requires a surety bond before the license can be issued.

Every auto dealer classification is required to purchase a surety bond, known as an auto dealer bond, before a license can be issued.

Here's a table showing the license, the bond amount, and the bond term which matches the license term.

License Classification Bond Amount Bond Term
Franchised Dealer $25,000 May 1 - April 30
Franchised Service Facility $25,000 May 1 - April 30
Independent Dealer $25,000 May 1 - April 30
Wholesale Dealer $25,000 May 1 - April 30
Auction Dealer $25,000 May 1 - April 30
Salvaged Dealer $25,000 May 1 - April 30
Mobile Home Dealer $25,000 Oct 1 - Sept 30
Mobile Home Broker $25,000 Oct 1 - Sept 30
New/Used Recreational Dealer $10,000 Oct 1 - Sept 30

What is an Auto Dealer Surety Bond?

A surety bond is a form of insurance that acts as a personal guarantee that you or the business will:

  • Follow all dealership laws and regulations passed by the Florida legislature
  • Pay all sales tax for vehicles or any merchandise sold through the dealership
  • Conduct business with your customers following legal and ethical business practices

What Does a Surety Bond Protect Against?

The FLHSMV wants to license dealers who will serve the public and provide economic benefit to the community so they require dealers to purchase a Florida auto dealer bond.

It's unfortunate, but there will always be a few dealerships who purposefully make poor decisions that harm their customers financially.

Some of these acts of misconduct and fraud include:

  • Failing to issue a title
  • Failing to properly transfer a title
  • Creating false titles
  • Misrepresenting vehicle information like odometer readings
  • Stealing from customer deposits or charging false fees
  • Not following the laws for operating a dealership
  • Failing to pay sales tax on vehicles sold

If a dealership is guilty of any of these acts, the customer or the Department of Revenue can make a claim against the bond for financial reimbursement. The reimbursement is capped at the bond amount for the given license.

How Much Does a Florida Auto Dealer License Cost?

Because a surety bond is a type of insurance, the cost is determined by a surety. A surety is the insurance company that writes surety bonds.

And similar to "typical" insurance, the surety quotes a rate based on personal, business, and industry factors that include:

  • Personal credit history of all owners
  • Business history and industry experience of ownership
  • Prior bond claims if any owner has previous been licensed with a claim
  • Plus the overall dealership industry in Florida

Each surety uses their own, proprietary, assessment to determine this rate. This means each surety provides a different rate. These rates can vary a lot causing price differences of hundreds of dollars for the same bond.

This rate multiplied by the bond amount for your license is the price.

To calculate the price of the Florida dealer bond, you take the rate quoted from the surety and multiply is by the bond amount for the license you are applying for.

Here is a table for example prices using the Independent Dealer license bond amount of $25,000. The rates range from good to average:

Bond Amount Rate Price
$25,000 0.5% $125
$25,000 1.0% $250
$25,000 1.5% $375
$25,000 2.0% $500

Surety Bonds Direct is a specialized surety agency and we can help you find the lowest pricing for the dealer bond you require. Visit our Florida auto dealer bond page and fill out our online quote form or call a bond specialist at 1-800-608-9950.

Step 3 - Liability Insurance Requirements

Each license type has some form of liability insurance requirement.

Independent dealers (used vehicle dealers), auction dealers must provide:

  • Garage liability with a minimum of $25,000 combined single-limit liability coverage, including bodily injury and property damage protection
  • $10,000 personal injury protection

Or these licenses can provide:

  • General liability policy coupled with business automobile policy at a minimum of $25,000 combined single-limit liability coverage including bodily injury and property damage
  • $10,000 personal injury protection

Franchise dealers, recreational vehicle dealers, and mobile home dealers selling recreational vehicles must provide:

  • Garage liability insurance at a minimum or $25,000 combined single limit liability coverage including bodily injury and property damage protection
  • $10,000 personal injury protection

These licenses are exempt from purchasing a garage liability policy:

  • Salvage dealers
  • Mobile home dealers which sell park models only

Step 4 - Location Requirements

Each location has requirements for the office space, the display area and for how the dealership is to be conducted.

Every dealership is required to follow the following location and office building requirements and have their dealership site approved by a Regional Office where the dealership is located.

Office Space Requirements

  • No personal residence can operate as office space
  • The offices must be a permanent structure or a trailer that is anchored and secured to the ground
  • The office must be a minimum of 100 square feet of interior space exclusive of hallways and bathroom square footage
  • Office space must have a minimum of 7 feet ceilings
  • Office space must be clearly separated from other businesses that may be operating in the same structure

Display Area Requirements

  • All dealerships must maintain a display space with the purpose of displaying vehicles for sale
  • The display space must be large enough to hold all vehicles for sale
  • The display space can be located outside or inside the building
  • Must be in full control of the dealership (not shared with any public right of way)
  • Easily accessible for the public
  • Must have direct access to a public roadway or highway
  • The property must be owned or leased by the dealership
  • If the property is next to another dealership the display lot must be physically divided by a barrier not less than 3 feet high

Business Operation Requirements

  • Licenses are not transferable
  • Business hours must be posted at the main public entrance
  • Dealership records must be available at all times for inspection by the FLHSMV
  • A permanent sign identifying the dealership with lettering that is readable from at least 50 yards away from the public right of way (street or highway) used to access the dealership

Step 5 - Required Documentation For Application Submission

Here's a list of the required documentation so you can ensure your application is submitted with 100% completeness.

  • Provide proof the business is registered, including any DBAs, with the Florida Division of Corporations
  • Provide a copy of dealer training school certificate. (You or an employee must have completed the training program within six months preceding the filing of initial application)
  • Copy of lease agreement or deed for the dealership property
  • Receipt of electronic fingerprint submission. (Court records must be submitted if any officer or owner of the business has been found guilty of any felony)
  • Copy of the surety bond for your license
  • Required liability insurance certificate

Licensing Periods

License Classification Bond Term
Franchised Dealer May 1 - April 30
Franchised Service Facility May 1 - April 30
Independent Dealer May 1 - April 30
Wholesale Dealer May 1 - April 30
Auction Dealer May 1 - April 30
Salvaged Dealer May 1 - April 30
Mobile Home Dealer Oct 1 - Sept 30
Mobile Home Broker Oct 1 - Sept 30
New/Used Recreational Dealer Oct 1 - Sept 30

Ready To Get The Lowest Price For Your Florida Dealer Bond?

When you're ready to get pricing for your bond, call Surety Bonds Direct and we will price shop for you and secure the lowest possible pricing we can find.

I hope this article helped make the application process for getting your dealership license easier to understand and follow.

The FLHSMV has a very thorough application packet, but it can be a little intimidating to get through.

Remember, you need to purchase your auto dealer bond before you submit your application for initial review. When you request a quote from Surety Bonds Direct, our bond specialists will hit the phones working to find you the lowest possible pricing.

Click here to start the quote process online.

Call a bond specialist today at 1-800-608-9950.

Surety Bonds Direct   Owen Hardy  

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