Montana Dealer License: Full Guide [2020]

Published: Nov 28, 2019
montana dealer license

 

Launching an auto dealership in Montana is an exciting business endeavor. If you’re thinking of starting car sales operations in the state, you need to get a Montana dealer license, so that you can operate legally. 

To prove your suitability for the job, you have to meet a list of requirements set by state authorities. One of the main ones is posting an auto dealer bond, which guarantees your legal compliance. 

You can learn the important details of the licensing process in the sections below. 

1. Discover the right auto dealer license type 

The licensing authority for auto dealers is the Motor Vehicle Division (MVD) at the Montana Department of Justice. You can obtain the following types of Montana car dealer licenses

  • Franchise Dealer – new vehicles (cars, trucks, rugged terrain, van and buses, new and used snowmobiles, motorcycles or quadricycles (including quadricycle-like vehicles) for off-highway or street legal use, boats (including personal watercraft), motor homes, special mobile equipment and trailers
  • Used Dealer – used vehicles
  • Wholesale Dealer – wholesale 
  • Auto Auction Dealer – auctions 
  • Broker Dealer – brokering vehicle sales
  • New Manufactured Home Dealer – new manufactured homes

2. Get acquainted with the Montana dealer license requirements

In order to get licensed, you have to meet a list of criteria set by the MVD. They are the following:

  • Information about business owners and partners
  • Business entity information
  • Business location requirements – a permanent non-residential building, business sign, office hours, and telephone
  • Computer, printer and access to the internet to issue electronic temporary registration permits (TRPs) (for new, used, auto auction and broker dealers) 
  • Information about the franchise sales agreement (for franchise dealers only)
  • Service department (for franchise dealers only)
  • General liability insurance (for new, wholesale, and auto auction dealers) 
  • Surety bond 

3. Prepare your documents

montana dealer licenseTo start your licensing, you need to complete the application form of the MVD. You have to indicate the type of license that you are applying for and fill it in duly.  

Along with proof of meeting the requirements described above, you also have to get an additional set of documents from other institutions:

  • Business name and/or DBA name from the Montana Secretary of State
  • Written verification for meeting city or county zoning requirements

4. Obtain the required Montana auto dealer bond 

An indispensable step of the licensing process is obtaining a surety bond. It serves as an extra layer of protection for the state and for your customers, which guarantees you will apply with all laws and regulations. 

The required amounts of the Montana auto dealer bond vary depending on the license type that you apply for:

  • $50,000 for new, used, wholesale, auto auction, broker, and new manufactured home dealers
  • $15,000 for new and used vehicle dealers selling only street legal motorcycles or quadricycles
  • $5,000 for new and used vehicle dealers selling only snowmobiles, non-street legal motorcycles or quadricycles, and boats

You don’t have to cover the whole amount to get bonded. Instead, you need to pay only a small percentage of it, which is your premium. The rates for applicants with stable finances range between 0.75% and 5%

5. Apply with your full document set

When you have compiled all the necessary documents, contact the Montana Highway Patrol, compliance officer, or local law enforcement agency. One of them has to complete the inspection form for your dealership

Afterwards, you have to submit all paperwork together with the application form by mail to:

Title and Registration Bureau
Motor Vehicle Division
1003 Buckskin Dr
Deer Lodge, Montana 59722

 

The licensing fees that you have to cover are:

  • $30 for new, used, wholesale and broker dealers
  • $50 for newly manufactured home dealers
  • $500 for auto auction dealers 

The plate fees are as follows:

  • $35 dealer plates
  • $15 demonstrator plates (wholesale and auto auction dealers)

You can consult the General Information and Requirements document prepared by the MVD for a full overview of the licensing process. 

6. Renew your Montana dealer license annually 

Your license expires on December 31st of each year for franchised, used, wholesale, auto auction, and broker dealers. The date for new manufactured home dealers is September 30th

If you want to continue your dealership activities, you have to undergo the Montana dealer license renewal process. This entails submitting an Annual Report.

The renewal fees are as follows:

  • $30 for new, used, wholesale and broker dealers
  • $100 for auto auction dealers
  • No fee for new manufactured home dealers

Wholesale dealers who have sold less than 12 retail used motor vehicles, power sport vehicles, trailers or wholesale vehicles in the last license term have to pay an additional renewal fee of $25.00.

 

Have more questions about getting a Montana auto dealer license and bonding? You can reach our bonding experts at 877.514.5146.

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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.

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