How to Get an Oregon Dealer License
To sell cars and other vehicles in Oregon, you need to obtain an Oregon dealer license from the Oregon Department of Motor Vehicles and post an Oregon auto dealer bond. You’ll also need to pass a criminal background check and ensure that your premises meet the necessary requirements.
To help you secure your license, and get your business off to a great start, we’re taking a look at everything you need to know about getting an auto dealer license in Oregon.
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Determine the Type of Oregon Dealer License You Need
There are two different types of dealer license you can apply for from the Oregon Department of Motor Vehicles (DMV):
- Standard License
- Special License
The standard auto dealer license is comprehensive and includes the right to operate as a dealer or a rebuilder of vehicles. The special car dealer license also allows you to sell motorcycles, mopeds, snowmobiles and ATV vehicles.
If you apply for a standard car dealership license, you’ll need to decide what type of cars you want to deal in. To sell brand new cars, you’ll need a new motor vehicle dealer license. Your new dealer license also allows you to sell used vehicles and buy cars at dealer-only auctions. If you plan to only sell used cars, you’ll need to apply for a used motor vehicle dealer license.
Once you’ve decided which type of license you need, you can start the application process. If you plan to apply for the standard license, you’ll need dealer application form 735-370. If it’s the special license you need, look for Form 735-366.
Contact your local DMV to find out more about the licensing requirements in your area.
Obtain a Permanent Business Location
All licensed dealers are required to have a permanent business location or established place of business. This is the place where your vehicles should be sold and displayed. Your dealership location should meet the following requirements:
- Be approved by your local zoning authority
- Have sufficient square feet available to display one or more vehicles
- Have a way for the public to contact the dealership during normal business hours
- Have an exterior sign with the business name permanently affixed to the building
- Display the vehicle dealer certificate in a clearly visible location
If you are a wholesale dealer, you may be exempt from some of these requirements. Contact the Oregon Department of Transportation or your local DMV to find out more.
Gather the Required Documents
The requirements for obtaining your Oregon auto dealer license are set by the Oregon Revised Statute 822.005 and 822.015.
As well as a completed dealer license application form, you’ll need to submit the following documents to the Oregon DMV:
- Proof of business entity and name
- Business location documents
- Dealer history of the main applicant
- $40,000 auto dealer surety bond for standard licenses and $2,000 bond for special licenses
- Liability insurance certificate
- Dealer education certificate from DMV-approved education providers
- Payment of relevant fees
- Certificate of insurance
- Proof of sales tax registration
The three-year license fee is $1,187 and includes one dealer plate. Each additional plate costs $54. If you want to license a second location, you’ll need to pay an additional $350 fee.
Get Your Oregon Auto Dealer Bond
Posting an auto dealer bond is one of the main requirements you need to fulfill to secure your dealer license. Instead of protecting the business holding the policy, surety bonds are designed to protect the customer.
Essentially, an auto dealer bond acts as an extra layer of protection for your customers and the state. Posting an Oregon auto dealer bond guarantees your customers will be compensated should your dealership fail to follow the rules and regulations that govern your industry.
Most dealers in the state will need to obtain a $40,000 Oregon Auto Dealer Bond.
To get bonded, you need to pay a fraction of the bond amount. This is called the bond premium and is, in practice, the surety bond price.
Typically, the surety bond cost auto dealers pay is around 1%-3% of the required bond amount. However, if you have a bad credit score or a poor financial history, you’ll be asked to pay more. Generally, a bad credit surety bond premium is around 5%-10% of the total bond amount.
When you apply for a bond, bond companies will look at your personal and business financials and carry out a background check. They’ll check your credit score and professional experience, as well as assets and liquidity. Once they’ve looked at these different factors, they’ll decide how risky your bond is. The lower they think the risk of a claim being made is, the lower your bond cost will be.
Submit Your Application
Once you’ve assembled your required documents, posted your motor vehicle dealer bond and paid your license fees, it’s time to submit your application. The licensing process takes between 7 and 10 business days to complete.
Renew Your License Yearly
You’ll need to renew your Oregon auto dealer every year. When renewing your license, you’ll need to show that you continue to meet all relevant requirements and take a refresher 4-hour training course to keep your skills up to date.
How Much Does It Cost to Get a Dealer License in Oregon?
A three-year Oregon motor vehicle dealer license costs $1,187 and includes one plate. Each additional plate costs $54. If you want to license a secondary location, you’ll need to pay an additional $350 fee.
How Many Cars Can I Sell in Oregon Without a License?
The State of Oregon allows the sale of up to five cars per year without the need for a dealer’s permit. If you want to sell more than five cars in a 12-month period, state laws require you to apply for an auto dealer license.
Can I Get an Oregon Auto Dealer License Without a Lot?
Oregon auto dealer license requirements state that dealers need to have somewhere to display the vehicles they have for sale. This doesn’t necessarily have to be a lot, but it does need to be a space large enough to accommodate the types of vehicles you plan to sell.
Your auto dealership location needs to meet all relevant requirements.
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