How to Get an Arizona Dealer License

Published: Jul 27, 2016
To become a licensed car dealer in Arizona you also need to post an Arizona auto dealer bond.

To get an Arizona dealer license you will submit an Arizona auto dealer bond along with your application at the Motor Vehicle Department.

 

Want to sell vehicles in Arizona? Before you can open your dealership, you will need to apply for an Arizona dealer license. Applicants for a license need to file an application with the Arizona Department of Transportation (DoT) Motor Vehicle Division (MVD), along with several supporting documents, as well as submit an Arizona auto dealer bond.

Read on below for a detailed guide on how to get an auto dealer license in Arizona.

Arizona auto dealer license types

Before you apply, you need to pick the license that is right for the type of business you want to establish. The DoT’s website lists 7 different types of licenses in Arizona related to the selling, auctioning or recycling of motor vehicles. These are as follows:

  • New Motor Vehicle Dealer
  • Used Motor Vehicle Dealer
  • Public Consignment Auction Dealer
  • Broker
  • Wholesale Auto Auction Dealer
  • Wholesale Motor Vehicle Dealer
  • Automotive Recycler

A detailed definition what each of these licenses entails and permits license holders to do can be found in this informative presentation put together by the Arizona DoT or in Article 1, Sec. 4301 of Title 28 of the Arizona Revised Statutes.

Breakdown of Arizona dealer license requirements

Once you’ve chosen the type of license you need, you can go ahead with fulfilling the various license requirements.

As a first, you need to fill in an Arizona Motor Vehicle Dealer/Sales Finance Company Application. Along with your application, you will also be required to submit the following items:

  • Fingerprint card
  • Personal history form
  • A copy of your Transaction Privilege Tax (TPT)
  • License issued by the Arizona Department of Revenue
  • Arizona Auto Dealer Bond
  • Copy of articles of Incorporation or your Partnership Agreement

In addition to submitting these and other documents that may apply, you will also be required to pay a $15 filing fee, a $22 criminal records check fee (conducted by the MVD after you have submitted your history form and fingerprint cart), a $100 license fee and an additional $50 branch office fee if you have more than one office.

Bond amounts for the Arizona auto dealer bond vary according to the type of license you are applying for. See the next section for the exact bond amounts.

Arizona auto dealer bond details

Bond amounts for the different Arizona dealer licenses issued by the MVD are as follows:

  • New and used motor vehicle dealers, along with public consignment auction dealers must post a $100,000 bond.
  • Brokers, wholesale auto auction dealer, and wholesale motor vehicle dealers must post a $25,000 bond.
  • Automotive recyclers must post a $20,000 surety bond.

For those who are new to surety bonds, this may sound like they need to pay the full amount to obtain a bond. In actuality, the surety bond amount is the full amount of compensation that a surety may extend to a claimant, while surety bond cost is only a small percentage of the full bond amount.

What determines the cost or rate of obtaining a bond are factors such as your personal credit score. Based on your score, the surety which issues your bond will offer you a rate at which you can obtain it. Applicants with high credit scores can typically expect to receive a rate between 1%-3% of the bond amount, which makes the cost of obtaining a bond fairly low.

Since not all applicants have perfect credit scores sureties, especially Lance Surety Bonds’ partners, will typically also provide bonds to applicants with low or even non-existent scores.

If you’re wondering how much it would cost you to get your Arizona auto dealer bond, you can get an entirely free quote on your bond by submitting your online surety bond application here. We will get in touch with you with your free quote in a short while.

You can also call us at 877.514.5146 to speak to our surety bond professionals and find out more about the bonding requirements for Arizona auto dealers.

 

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Victor Lance is the founder and president of Lance Surety Bond Associates, Inc. He began his career as an officer in the U.S. Marine Corps, serving two combat tours. As president of Lance Surety, he now focuses on educating and assisting small businesses throughout the country with various license and bond requirements. Victor graduated from Villanova University with a degree in Business Administration and holds a Masters in Business Administration (MBA) from the University of Michigan's Ross School of Business.