How to Get a North Carolina Auto Dealer License

You need to get a North Carolina auto dealer license if, in a 12-month period, you buy, sell (or attempt to sell), display, or exchange at least 5 motor vehicles in your name.
Dealer licensing is handled by the License and Theft Bureau of the North Carolina Division of Motor Vehicles. Discover the step-by-step process on how to get one.

1. Identify The License Type You Need

If you want to trade as an auto dealer in the state, you’ll need to apply for one of the following licenses:

• New Motor Vehicle Dealer License: Allows you to sell both new and used vehicles.
• Used Motor Vehicle Dealer: Allows you to sell used vehicles.
• Distributor License: Allows you to distribute/sell new vehicles to new car dealers.
• Wholesaler License: Allows you to distribute/sell used vehicles to car dealerships.
• Manufacturer License: Required for those that assemble/manufacture vehicles or import new motor vehicles through a distributor with the intent to further distribute.

2. Complete a Pre-Licensing Course

If you're planning to sell used cars in North Carolina, you must complete a dealer education course as part of the licensing process. This pre-licensing course should be taken within the 12 months prior to submitting your license application. You can find this course at various locations, including Davidson-Davie Community College. It takes a 12 hour course, if you’re seeking an initial license, or a 6 hour course if you’re applying for renewal.

3. Establish Your Business Location

There are a number of business location requirements that you’ll need to meet before you can apply for your license. These include:

• Retail dealers are required to maintain a standalone, enclosed salesroom of at least 96 square feet, with a dedicated entrance, separate from living spaces and other businesses.
• Wholesale dealers must have an established office to keep books, records and files. 
• Dealers must display a sign at their business premises. This sign must have block letters no less than three inches high and on a contrasting background. The sign must clearly and distinctly show the trade name of the business.

4. Acquire Liability Insurance

Obtaining comprehensive liability insurance that includes coverage for your dealer plates is mandatory. Make sure to include your policy number on your application.

5. Secure an Auto Dealer Surety Bond

Everyone applying for a car dealer license in North Carolina is required to post a North Carolina Auto Dealer Bond.

The required bond amount is $50,000 for your first location and $25,000 for each additional location (if applicable).

To get bonded, however, you only need to pay a fraction of this amount. To determine your exact bond cost, (known as your bond premium) we’lll look at a number of factors including your:

• Personal credit score
• Business statements
• Financial statements
• Fixed and liquid assets

Recently, we assisted a client who needed a surety bond to complete their North Carolina auto dealer license application. We guided them through the process, explaining the bond's role in ensuring ethical business practices and compliance with state regulations. Their appreciation for our clear and supportive approach made the experience particularly rewarding for us.

6. Compile All Documents

The following forms are required in order to process your application: 

• LT-400 (Notarized); 
• LT-409 (Notarized); 
• LT-426 (Notarized); 
• If corporation/LLC, copies of your meeting minutes and Secretary of State filing; 
• If franchise, copy of franchise agreement(s); 
• If out of state manufacturer or distributor, certificate of authority;
• Out of state manufacturers must also provide proof of registration with the National Highway Traffic Safety Administration (NHTSA) 

For a complete list of requirements, check Minimum Dealer License Requirements

7. Arrange a Business Site Inspection

Before submitting your application, it's mandatory for all dealerships to undergo an inspection and receive approval from an agent of the License and Theft Bureau. To arrange this inspection, contact the License and Theft Bureau office in your local town or county. The inspector will assess your premises to verify compliance with all necessary safety and security standards.

8. Submit Car Dealer License Application

Once you’ve filled in all your forms and assembled your paperwork, you’ll need to send your completed application to:

N.C. Division of Motor Vehicles
Vehicle Services - Dealer Unit
3129 Mail Service Center
Raleigh, NC 27697-3129