How Much Does a California Used Car Dealer License Cost?
September 22nd, 2026 by Jessica Biarbe, retired DMV licensing inspector
If you're thinking about opening a used car business in California, one of your first questions is probably "What will it cost?" The answer depends on whether you want a wholesale license (selling exclusively to other dealers) or a retail license (selling to the public or other dealers), where you set up, and a few costs people often forget. I spent 18 years as a DMV Licensing Inspector, so here is what I see new dealers budget for and what surprises them.
1. Pre-license education
Every first-time applicant must complete a pre-license class. Our six hour Pre License Class is offered as a live webinar OR a self-paced online course.
Class Fee ranges from $125.00 for the Zoom Webinar and $85.00 for the Self Paced Class. You will receive a study guide that includes the application process information and a practice test. Upon completion of your course, the Certificate of Completion is emailed to you with valuable information and supplemental practice test at no additional charge, as well as 1 year consultation. The Original Certificate of Completion is mailed out the next business day. To enroll visit the website at: https://www.usedcardealerclass.com/
2. DMV application and license fees
Currently the application fee is $175 + $1.00 family support. Dealer Plate fees vary according to the county where your business is located in. The base fee is $92.00 for an auto/commercial dealer plate or $94.00 for a motorcycle dealer plate; then add the county fee.
The DMV OL 22 fee schedule is at dmv.ca.gov - page 2 is the county fee schedule for dealer plates.
See California dealer license requirements for what the application itself asks for.
3. Fingerprinting (Live Scan)
Applicants are fingerprinted through Live Scan, and there is a fee for each person. Fees vary depending on your Live Scan operator. You will need to take the Form - dmv8016 with you for your Live Scan operator. The form can be obtained on the DMV website at: dmv8016.pdf. Our article on Live Scan fingerprinting walks through the appointment.
4. Dealer surety bond
California requires a dealer bond. You pay an annual premium, not the full bond amount, and your premium depends largely on your credit. Each student receives an emailed application to give you a starting point for your bond.
5. Insurance
Expect to carry garage liability insurance, which varies with your location and type of license. Bond and insurance questions come up often, which is why we keep a dealer licensing FAQ on the site.
6. Your place of business
This is usually the biggest variable. A wholesale license generally needs a compliant office only where records for your dealership will be kept. There is no sign requirements for a wholesale dealership. DMV will inspect your location for compliance.
A retail license needs a compliant office, display area and signage. The DMV inspects the location for compliance, so signage, posted hours, and records storage must be in place before you schedule. 24-7 Dealer Training Specialists does have location referrals available upon request for our students. For more on this step, see how to tell if your dealer location is in compliance.
Business entity formation
Most newly licensed dealers operate as an LLC or a Corporation rather than as a sole proprietor, the DMV application asks for your business entity information, so this needs to be done before you apply. Any changes to the ownership structure would require a dealer to go out of business and completely reapply.
We can set this up for you. Our in-house specialist forms California LLCs and corporations and understands what the DMV expects to see on a dealer application. Doing it here means your business name, ownership, and address are consistent across your entity papers, your bond, and your DMV application, which helps avoid delays.
7. Setup costs new dealers forget
- Business entity formation (for Corporation or LLC)
- Business Location
- City business license
- Dealer plates
- Record-keeping supplies and a lockable file cabinet
- Business phone line - cell phone is acceptable
- Fictitious Business Name Filing (Only if you have a DBA for your company)
Not sure which license fits your plan?
Our instructors can help you decide and can help with your application. Call (951) 833-8398 or enroll in our pre-license class today at usedcardealerclass.com.
Disclaimer: This article is for information only and is not legal advice. Fees and requirements can change at any time.
Posted in: Dealer Licensing