Georgia is a unique state when it comes to issuing used auto dealer licenses. It's one of the only states that allows you to sell used vehicles from your private residence or without a showcase lot. If you're looking to get your used dealer license in Georgia, this article is going to:
- Outline the application steps
- Highlight the education requirements
- Explain the surety bond requirement
- Detail the liability insurance requirements
- Go step by step over the property requirements
- Plus help you with organizing the necessary links
If you want to skip around to a relevant section, use the list below:
- Step 1: Complete the application
- Step 2: Pre-Licensing Education
- Step 3: Purchase Dealer Bond
- Step 4: Purchase Liability Insurance
- Step 5: Obtain Sales Tax Number
- Step 6: Pre-Register for Fingerprints
- Step 7: Property Requirements
The 7 Steps To Get a Used Dealer License in Georgia
The Used Motor Vehicle Board is responsible for issuing and regulating used vehicle dealers in Georgia. They meet at least six times per year to review applications.
The used dealer license is a 2 year license that expires on September 30th of even numbered years.
Step 1: Complete The Application
The application itself is straightforward. Here are some of the must know information as you go through each section.
Your Personal or Business Name
Whether you're getting licensed as a sole proprietor or as a business entity, make sure you:
- Use your full legal name and the full legal names of all owners if you have more than one
- Use the exact name of your business as registered with the Georgia Secretary of State
- If you're using a DBA (doing business as) name, use the exact name as registered with the Secretary of State
It's vital you use the name from the application on your surety bond and your liability policies. This is a common mistake that can cause your application to be delayed.
Appoint a Designee
A designee is the individual who is the "responsible license holder" for the business.
The designee is the dealership operator in charge of the dealership for the partnership, LLC, or corporation. If you're a sole proprietor, you are considered the designee.
There is a full page asking about the history of the designee and the relationship with the dealership.
Affidavits of Authorization
There are a few affidavits (legal sworn statements of fact) of authorization you'll need to complete on the application.
One for the designee to attest that they are the designated designee for the dealership and that they accept all the responsibilities for running the dealership.
If your business structure is a partnership there is a separate affidavit attesting to the partner that accepts the role of designee and all of the responsibilities for running the dealership.
The final affidavit is for the individual filling out the application, attesting that all of the information is correct.
Application Fees
The Board requires an initial $170 application fee and a $10 processing fee (at the last update of this post).
And make sure you have the final application notarized or it will be delayed.
Step 2: Pre-Licensing Education
Before you submit your application to the Board, you must complete a Board certified pre-licensing seminar from:
- E-Learning
- GIADA
- Automobile Dealer Training Association
- Ron Widener
All of the contact information for these locations is located here: sos.ga.gov.
The seminars cover the used dealer market in Georgia as well as the best practices to get new used dealers the best chance of success.
Dealers are required to obtain 6 hours of continuing education each year before the license can be renewed.
Step 3: Purchase an Used Auto Dealer Surety Bond
The Used Motor Vehicle Board required all used dealers in Georgia to purchase a surety bond in the amount of $35,000 to be submitted with the application.
A surety bond is a type of insurance that acts as a promise you will follow all the laws and regulations for operating a dealership in Georgia. It's also a promise to your customer base that you will serve your customer with fair and ethical business practices.
Unlike traditional insurance the Georgia auto dealer bond has a set amount. You can't purchase "additional" coverage.
What Does an Auto Dealer Bond Cover?
An auto dealer bond is one level of protection for customers and the Georgia Department of Revenue if a dealer purposefully commits fraud or misconduct, a licensing violation, or some other unethical act that financially harms a customer or the state.
Examples of misconduct and fraud are:
- Selling vehicles with fake titles or floated titles
- Issuing a title for a vehicle
- Lying about vehicles milage or original model year
- Lying about accident history or vehicle condition to make a sale
- Stealing from customer deposits or charge unfair fees
- Failing to pay Georgia sales tax on sold vehicles
If a dealer is found guilty of any of these or similar acts, the customer or the state of Georgia can make a claim against the surety bond for financial repayment, but only up to the $35,000 bond amount.
How Much Does a $35,000 Auto Dealer Bond Cost?
The Georgia used auto dealer bond price is a small fraction of the $35,000 bond amount.
The bond price is determined by a custom quote from a surety.
A surety is an insurance company that underwrites surety bonds. Like any insurance company, each surety uses their own assessment to determine this rate.
The primary factors used to determine this rate are:
- Credit history of the owner or all owners of the dealership
- The past dealership history or and industry experience of ownership
- Prior dealer bond claims if there are any
The rate quoted multiplied by the bond amount is the price you pay.
Here are some examples of pricing from really good rates to average rates.
| Bond Amount | Rate | Price |
|---|---|---|
| $35,000 | 0.5% | $175 |
| $35,000 | 1.0% | $350 |
| $35,000 | 1.5% | $525 |
| $35,000 | 2.0% | $700 |
When you're ready to get pricing, use our online quote form or call a bond specialist at 1-800-608-9950 to get the quote process started. It only takes about one business day to get pricing and there's no obligation to purchase once you do.
Step 4: Purchase Liability Insurance
A Garage Liability policy must be purchased. The Board will not accept only an automobile liability policy.
The minimum amount of coverage is:
- 50k maximum coverage for per person for bodily injury during an accident
- 100k maximum coverage for per accident for bodily injury
- 25k maximum coverage for property damage
Remember these are only the minimum required amounts by the Board. You must assess your business plan and decide the amounts that are correct for you.
Step 5: Obtain Sales Tax Number
The dealership must obtain a sales tax number and use tax number from the Georgia Department of Revenue. Applying for these numbers is done online through Georgia Tax Center
The sales tax number allows you to collect and pay sales tax for any vehicle and merchandise sold.
The use tax is collected in situations such as:
- Purchasing a vehicle from a private seller
- Purchasing an out-of-state vehicle
Step 6: Pre-Register for Fingerprints and Background Check
The application must be on file with the Board before fingerprints can be taken. However, you must pre-register for fingerprints at: www.FieldPrintGeorgia.com
Once the board verifies the initial application, fingerprints can be taken based on the pre-registration location.
If on the application's background check you answered, "yes", you must include further information on all convictions including:
- Date of all arrests and convictions
- Certified copies of court dispositions
Make sure you disclose everything on the application. If the fingerprint background check uncovers prior legal issues, penalties can be issued and the application can be denied.
Step 7: Property Requirements
Georgia is a unique state because as long as you meet certain requirements, you're able to operate a dealership from your private residence.
The "established place of business" requirements are:
- Must be a permanent building where financial records are kept
- Must be the location where the dealership negotiates and conducts sales
- Module trailers are allowed as long as they are permanently fixed to the ground with no wheels
- Must have. a land based telephone line and the phone number must be listed in the licensee's trade name, the business name, and in any advertisement
- Must have a permanent sign erected according to the local laws and rules where the dealerships is located
- Free standing signs must be affixed to a metal base or frame with concrete footings
- Signed attached to the buildings must be permanently bolted to the building
- Lettering on the sign must be a minimum of six inches in height
- One sign must be clearly visible to consumers from the street used to access the dealership location
- Painted signs are allowed as long as they meet the above rules and are allowed by local ordinances
- If the dealership office is in an office building and suite, the sign must at least be publicly displayed on a marquee in the lobby and directly outside the suite where the dealership is located.
Open Lot Dealerships
For dealerships operating in an open lot where vehicles will be displayed:
- The office must be located on the same property as the display lot
- Only one dealer can be licensed to operate an open lot as defined by the county tax assessor's office records
Personal Residence
Local zoning ordinances must be proved for a personal residence to be used as a dealer location including:
- The dealership office must be separate building from the primary residence
- Must be readily accessible to the public and the Board for inspections
- All office equipment and services must be purchased and used exclusively for business operation
- Must contain office furnishings to accommodate the public
- The issued license must be displayed in a prominent place within the office
- The sale tax number and use tax number must be prominent place as well
All of these requirements must be met, even if you plan on selling vehicles over the Internet.
Photos of Business Location
Once you meet all of these requirements for the location, "enough" photos must be submitted showing:
- The inside of the office space
- The outside of the property showcasing the complete property
- The signage
- The entire display area of the property if applicable
Finally, make sure you have proof of the appropriate zoning for the dealership location.
We're Ready When You Need To Get Your Auto Dealer Bond
I hope this article makes going through Georgia's used dealership licensing process easier.
Georgia has a lot of information all over their dealer site. For your reference, their FAQ page helps to answer many questions you might have.
If you have any questions about the surety bond requirement, we are here to help you.
Start by getting pricing. It costs you nothing to have us price shop for you and find the lowest price. Plus there's no obligation to purchase once you get pricing.
Click here to visit our Georgia dealer bond page. Here you'll find more information about the bonding requirement and you can start the quote process.
If you'd prefer to speak with a bond specialist, call 1-800-608-9950.
