used car dealer

used car dealers

Used Car Dealership: How to Become Used Car Dealer in US?

Selling cars can be a very profitable source of income. As with any business activity, there are several things you will need to understand in order to establish your own used car dealers in your state. Much of this involves moving car across country, meeting licensing requirements and establishing insurance and bonds.

How to Become a Used Car Dealer

Becoming a used car dealer requires more than just inventory. To operate legally in your state, you must obtain an operating license, dealer license, surety bond, and insurance. Below is an easy-to-follow, step-by-step guide to help you in your new venture of opening a used car dealership.

How does a Used Car Dealer generate Income?

As a used car dealer, you can make money in a variety of ways. You can only buy automobiles from wholesale dealerships and resell them for a profit. In the beginning, this can be your main source of income. You can easily get the vehicle shipping quotes from different service providers to get these cars to you.

Over time, you may try to get damaged vehicles. Once the repairs are done, you can sell the automobile for a higher profit. Additionally, expanding your used car dealership to include vehicle repair, maintenance, notary services, and parts can be a great way to increase your income.

Steps to Become an Authorized Used Car Dealer

1.    Prepare a Business Plan

Before starting any legal process or setting up your firm, you must first sit down and create a business strategy. It describes your purpose, how you plan to organize your firm, your strategy of operations, and how you finance it. By making the effort to do this now, you’ll be prepared when you apply for financing, and you’ll stay on track as you work toward becoming a wholesale or retail dealer.

2.    Get a Business License

Next, you need to obtain an official business license to operate your used car dealership. You can obtain a license by visiting your local business licensing body or the Secretary of State’s website. The DMV will need some basic information about you and your business.

If you plan to have employees in your business, you will also need to obtain an Employee Identification Number (EIN) through the IRS website. This EIN must be provided with your dealer license application form for your application to be evaluated.

3.    Submit an Application for a Used Car Dealer’s License

A car dealer license is another requirement before starting your startup. This car dealer license can be obtained through your state’s Department of Motor Vehicles (DMV) website. From state to state, the specific requirements for obtaining this dealership license and business zoning will vary.

4.    Get an Auto Dealer Bond

You should anticipate that most states will require you to obtain insurance and a surety bond. This is a dealer bond that provides protection in case you violate the state’s mandatory regulations. This car dealer bond is often available for a small fraction of the total value of the bond.

Your credit score and other factors will play a major role in deciding your bond amount. Before deciding which bond to buy, it is highly recommended to get estimates from multiple suppliers.

5.    Fill your Space with Automobiles

After obtaining your business license, vehicle dealer surety bond, and used car dealer license, it’s time to start stocking your business location with cars and car transport. Many new car dealers get their inventory directly from the automaker. However, used automobile stores obtain their inventory from a variety of sources, including:

  • Private Parties
  • Wholesale Dealers
  • Auctions

Having automobiles ranging from sedans to pickup trucks is a great way to attract a large number of customers. You can easily acquire cars from auctions and connect with the best auto shipping company in US to get them in your garage.

How to Get the License for Used Car Dealer

The steps below explain how to get a license and bond to open a car dealership. Check your state’s regulations for specific restrictions and regulations.

Contact your Local DMV

Each state has its own standards for establishing an automobile dealer. As a Georgia used automobile dealer, you should contact the Georgia DVM. Your state will inform you of the requirements for obtaining a license as a used automobile dealer. They will also provide you with any relevant paperwork to complete and further instructions.

Meet the Requirements

Depending on the state you live in, this can be a long list. Before obtaining a license as a vehicle dealer, the majority of states require that you meet certain basic requirements, such as obtaining a legally zoned location and obtaining approval for your location and business.

Complete the Car Dealer Licensing form

Your local DMV will provide you with the appropriate application for a used car dealer license for your business.

Buy Automobile Dealership bonds

Almost every state requires the purchase of dealer bonds from vehicle dealers. A car dealer bond is a type of client protection surety bond. With the help of this, you can easily ship a car from another state.

Submit an Automobile Dealer Application

Submit your application for a vehicle dealer license, dealer bond, proof of insurance, and other required documents to your local DMV or Auto Dealer Licensing Service Department and wait for approval.


A used car dealer can be a great option to start your own flexible business. A primary advantage of opening a used car dealership as opposed to a new car dealership is the ability to sell automobiles of various makes and models.

Tips and Guide for Selling a Car at Auction

The process of selling a car can be difficult and ultimately frustrating. If you trade in it, you probably won’t get as much as you could get.

If you try to sell it directly to a third party, you must do all the advertising and spend hours showing it to interested parties, with no assurance that any of them will buy it. Solution to these problems is one, sell your car at nearest auction places.

In this post, we will discuss the a few tips to selling a car at auction:

Tips for Selling a Car at Auction to Get the Bit You Want on Your Car

· Choose your platform

If you’re trying to sell a 10-year-old, average passenger car, it’s hard to beat Facebook. Listing is free, there are no transaction fees, and you can upload multiple photos. Listing platforms like Kelly Blue Book and Auto Trader spread information about upcoming sales to a wider audience and potentially weed out scammers. eBay and Bring A Trailer, with their auction-style listings, can be a great way to maximize your selling price for rare and more expensive cars and trucks.

· Price your vehicle before selling it online

The next step is to determine the price of your vehicle, and this handy tool explains how to selling a car at auction. Checking the value of a vehicle online will tell you how much it is worth on the private market, through a dealer, or as a trade-in. You can determine whether the extra money you can earn on the private market is worth the effort to advertise, display and sell your vehicle.

· Clean the car

No one wants to witness a dirty car. If you lack the time to vacuum and clean the interior and wash and wax the exterior of your vehicle, you should pay someone else to do it for you. Even if you’re selling a car for $1,500, detail work can make a $200 difference when it’s time for the buyer to put down the cash and complete the transaction.

For more protection, we recommend you to use enclosed carrier car shipping service. This will help you’re your car to reach destination without any scratch.

· Take multiple photos when selling online

When selling a car at auction, posting a photo is no longer acceptable. Online car buyers want to see your vehicle from all angles, inside and out. As mentioned earlier, make sure the vehicle is clean. Try to take pictures in a place where there is light. Photography is prohibited after dark. Taking photos in direct sunlight can result in images with harsh shadows. Choose a location with a plain background.

· Be open to negotiation

If  you’re wondering how to selling a car at auction, keep in mind that when you list a car, most buyers will assume that the price is negotiable.

One way to prevent this is to ask for a slightly higher price. If you can shave at least a few hundred dollars off your asking price, the majority of buyers will feel more comfortable making the purchase. A little flexibility goes a long way and can result in a faster sale.

Should I be Selling a Car at Auction?

Advantages of Selling a Car at Auction

If  you choose selling a car at auction, organizers will help advertise and display in front of a room full of potential buyers. As a result, you are less likely to waste time with viewers who have no intention of buying your vehicle.

Disadvantages of Auctioning my Car

There is no guarantee that your vehicle will sell at auction, and you will be required to pay the pre-listing fee regardless of the outcome. Remember that if you sell successfully, you will need to pay an additional fee to the auction house.

Frequently Asked Questions

1. Do I need to arrange transportation to sell my car at auction?

You will need to take the vehicle to the auction house or pay for a collection service. If you’re selling your primary vehicle at auction, you’ll need to travel with a friend or take public transportation.

In other case, you can ask a vehicle shipping company to take your car at auction place, while you can take a ride with any companion.

2. Can I auction a damaged vehicle?

You should be able to sell a vehicle with minor blemishes at a traditional auto auction, even though the price may be lower. If your vehicle is seriously damaged, you may be more likely to sell it at a salvage auction.


Choosing to sell a car at auction can save you a lot of time and ensure that you get the most money for your car. A vehicle in poor condition may not be accepted as a trade-in, and you may have trouble finding a buyer for it in the classifieds. However, selling at auction significantly increases the likelihood that someone will buy your vehicle.