Arkansas Dealer License Guide: Full Guide (2024)

Getting an Arkansas dealer license is the first step to launch your car sales business in the state and explore the opportunities in the auto dealership industry.

The procedure is comprehensive and entails meeting a list of requirements set by the licensing authorities. A major criterion that you have to satisfy in order to get licensed is to obtain an auto dealer bond. It guarantees your legal compliance and protects the public. 

For further information about each step of the licensing process, you can delve into the sections below. 

1. Choose the dealer license type you want

The license type that you need to obtain depends on the kind of vehicles that you want to sell. There are two authorities that can issue your Arkansas dealer license.

The Arkansas State Police (ASP) provides the following license types:

• Used Motor Vehicle Dealer - used vehicles
• Wholesale Motor Vehicle Dealer - wholesale 

The other dealer licensing authority is the Motor Vehicle Commission (AMVC). The license that you can obtain from it is:

• New Vehicle Dealer - new vehicles

2. Get acquainted with the Arkansas dealer license requirements

The licensing requirements vary for the different license types. 

The criteria for obtaining an Arkansas used car dealer license or wholesale license  from the ASP are as follows:

• Business entity and owners information
• Location requirements - business sign and a filing cabinet
• Photos of business location and sign
• $75,000 liability insurance coverage
• Surety bond

If you want to get a new car dealer license from the AMVC, the requirements are the following: 

• Information about the business entity and all owners and partners
• Location requirements - office area, display area, and service and parts area
• Photos of all business location areas
• Signed Manufacturer/Distributor franchise agreement or Dealer Sales and Service agreement
• Letter of intent of the Manufacturer/Distributor to establish a dealer point
• Salesperson application
• $75,000 liability insurance coverage
• Surety bond

3. Prepare your application documents

If you are applying for an Arkansas State Police used car dealer license or wholesale license, you have to fill in the application form to start your licensing process. Together with it, you have to prepare a proof of meeting the licensing requirements described above.  

In order to apply with the AMVC for a new car dealer license, you have to complete its application form. 

You also have to obtain documents from other institutions that should be attached to your respective application:

• Business registration with the Secretary of State
• Employer Identification Number (EIN) from the IRS
• Sales tax identification number from the Department of Finance and Administration
• Zoning approval for your business location from your county or city
• City or county business license or registration (if needed)

4. Obtain the necessary Arkansas auto dealer bond 

An Arkansas auto dealer bond is necessary for all license types in the state. The bond functions as a safety mechanism that ensures dealers will comply with all applicable state regulations. 

The bond amounts are the following:

• $25,000 for used car dealers
• $100,000 for used car dealers with multiple locations
• $50,000 for new car dealers, plus $25,000 for each additional location

The bonding process entails that you cover a premium, which is a small percentage of the required amount. It is set on the basis of your personal and business finances. The rates for applicants with stable profiles are between 0.75% and 5%. 

5. Apply with your full document set

In order to apply for a used dealer license from the ASP, you have to mail your completed application form and paperwork to:

Arkansas State Police
Attn: Used Motor Vehicles
#1 State Police Plaza Dr.
Little Rock, AR 72209

The fees that you have to cover are:

• $250 licensing fee for the first location
• $125 fee for each additional location

When your application has been reviewed, you will get an inspection from the ASP. If you pass it successfully, you will receive your license.

If you are applying for a new car dealer license from the AMVC, you need to send your application and documents by mail to:

Arkansas Motor Vehicle Commission
101 East Capitol, Suite 204
Little Rock, AR 72201

The relevant fees that you have to pay are:

• $100 license fee for the primary location
• $25 fee for each additional location
• $15 fee for each salesperson

6. Renew your Arkansas car dealer license annually

All types of licenses expire on December 31st of each year. This means you need to renew your license with the ASP or AMVC annually before the expiration date. That’s how you can ensure you can continue your dealer operations in legal compliance. 

Have further questions about obtaining your Arkansas auto dealer license? You can reach us at 877.514.5146.