Download Your FREE Texas Dealer License Start Up Guide
7 Steps to Obtain a
Texas Dealer License (General Distinguishing Number)
1. Take Online Dealer Educational Course
2. Must Have
A Business Building With Sign and Display Area
3. Apply
For Employer Identification Number
4. Register with Secretary of
State or County
5. Obtain Dealer Surety Bond
6. Submit
Application Through eLICENSING
7. Maintain Business Hours
and Records
1. Dealer Educational Course
Many persons applying for a Texas Dealer License
or General Distinguishing Number (GDN) for the first
time must take a
six-hour web-based dealer educational
course. The course is required if selling cars,
trucks, motor homes, neighborhood electric vehicles,
recreational off-highway vehicles, atvs, and utvs. The
course must be taken by an owner or manager that is
listed on the application. The Automobile Dealer
Training Association's Dealer Pre-License Course is
approved by the Texas Department of Motor Vehicles and
meets the State of Texas' 6 hour dealer educational
requirement.
Click here to enroll now!
Most dealers that
were licensed as a Texas Dealer License for the first time after September 1, 2009
must take a three-hour web-based Texas Dealer License
educational course.
You will receive an Official
Certificate of Completion at the end of this course. Be
sure to upload the certificate in with dealer license
application submission. When you complete your
online
training, you will be confident and prepared to operate
a licensed Texas dealership.
2. Business Building With Sign and Display Lot
You must have a place of
business to gain a Texas Dealer License. The building
must meet all local zoning requirements and include an
office for the operation of your dealership. If the
office is at a private residence, it must be completely
separate from the actual residence and meet zoning
requirements from that city or county. Your office must
include, at minimum, a desk, two chairs, internet
access, and a working telephone listed in your
dealership name.
If a Texas dealer shares their
location with another business, the dealer must have
their own office area. The dealer must either own the
property where the license is located or lease it for
the entire term of the dealer’s license. The law
requires you to display your dealer license.
You
must have a display lot either inside or outside the
building with sufficient space to show five of the
vehicle types you are selling. The display lot must not
be a driveway and must be a hard surface such as
concrete or gravel. Some local zoning ordinances may
require you to pave the area.
As with the
building, the lot must meet all local zoning
requirements. If a dealer operates at night, the display
area must be illuminated. Wholesale vehicle dealers are
exempt from some display area requirements. You will
learn more in your dealer course.
The State
allows up to four retail dealers and up to eight
wholesale dealers to operate out of one business
building. Retail dealers and wholesale dealers in Texas
may never share the same building they must operate in
separate dealer buildings. You will need a permanent business sign which
is visible from the public roadway. The dealership name
must be at least six inches tall or larger, and the sign
must be permanent and clearly visible to the public.
Wholesale dealers must have the sign mounted on or next
to the office door with the business name in at least
two-inch letters. Be sure the letters in the dealership
name meet the minimum height requirements under Texas
law. We cover the building, sign, and display
specifications more extensively in your online training
course.
3. Employer Identification Number (EIN)
Before submitting your dealer application, many persons must obtain an Employer Identification Number (EIN). This number identifies your new business, and you will need it for tax purposes. Securing this number is a quick and easy step, which only takes a few minutes. You can apply online and have your new Employer Identification Number in a matter of moments. Once you have received your EIN, be sure to include it on your dealer license submission. We will cover the EIN registration extensively in the course.
4. Register Business Name with Texas Secretary of State or County
Most dealers must register their business name with the Texas Secretary of State, which must record every business operating in the state. Registering your business with the Secretary of State is covered in great detail in your dealer training course. Certain business entities will only register with the county in which they are located. We will walk you step by step through the simple registration process.
5. Dealer Surety Bond
Most dealers must secure a $50,000 dealer surety bond to get a Texas Used Motor Vehicle Dealer License. With good credit, you should get a $50,000 dealer surety bond for $200 to $350 per year. If you have a couple of blemishes on your credit score, the price can be much higher. Franchised dealers, travel trailer dealers, and utility/semitrailer dealers are exempt from the surety bond requirement. We cover dealer bonds in depth in your dealer license training.
6. Submit Application Through eLICENSING
You must submit your Texas dealer license application online through the Texas Department of Motor Vehicles’ eLICENSING system. Applications are no longer mailed. Submit your dealer license application at https://texasdmv.force.com/customers/lace_login . The application process is quite extensive and must be completed correctly and in its entirety. Mistakes on your dealer application can cause significant delays in your licensing process. We will submit a dealer license application online in your dealer training course and ensure you know how to apply correctly for quicker approval.
7. Maintain Business Hours and Records
A retail Texas dealer must be open at least four days a week for at least four consecutive hours per day. A wholesale dealer must be open at least two days per week for at least two consecutive hours per day. Travel trailer and trailer/semi-trailer dealers may operate seven days a week. If a person holds a motor vehicle license and a trailer license, they may open on Saturdays and Sundays but cannot sell motor vehicles on both Saturday and Sunday. Motor vehicles may only be sold on Saturday or Sunday, never on both days. We will discuss hours of operation extensively in your six-hour web-based dealer license class. You must also maintain records on all vehicles purchased, leased, and sold, for a minimum of 48 months. Just copy every document that comes across your desk. We will review an entire section on exactly which records to keep in your course.
You Must Follow all State and Federal Laws
In your Texas dealer license training course, we will show you how to comply with all state laws that come out of Austin and all federal laws that come out of Washington. If you follow every state and federal law, you will achieve much higher profits. If you maintain 100 percent compliance, you will maintain 100 percent profits. The Texas Department of Motor Vehicles is basically giving you a license to make as much money as you can, as long as you are following ALL the rules. In your Texas Dealer License course, we will show you how easy it is to follow all the rules.
Click here to view more information on How to Get a Dealer License in Texas
How to Get a Texas Dealer License Long Version
We are here to help you start obtain
a Texas Dealers License (GDN)!
Delus Johnson-Lead Instructor
Automobile Dealer
Training Association