Vehicle Dealer Bond

Yes, wholesale-only dealers may apply for a $50,000 bond exemption by submitting form OL 56 to the DMV. This exemption must be renewed with your license.

The bond and dealer plates are separate requirements. Dealer plates are optional but commonly used. The bond is mandatory for licensure. Dealer plates cost $92 each plus county fees.

No, only used vehicle dealers and wholesale-only dealers must complete the DMV Dealer Education Program and pass a test. New vehicle dealers are exempt from this requirement.

Yes, California requires all vehicle dealers to obtain a Resale Permit from the California Department of Tax and Fee Administration (CDTFA) to legally collect sales tax from customers.

No, one $50,000 bond covers your main location and all branch locations. However, you must pay a $70 fee for each branch location when applying or renewing.

The cost varies based on your credit score and financial history. Dealers with good credit typically pay 1-3% of the $50,000 bond amount annually ($500-$1,500), while those with challenged credit may pay 3-10% ($1,500-$5,000) or more per year.

Both require the same $50,000 bond amount. The main differences are in other requirements: new dealers must participate in the Business Partner Automation Program (mandatory), while used dealers must complete dealer education and pass a DMV test. Wholesale-only used dealers may qualify for a bond exemption.

All California vehicle dealers must obtain a National Motor Vehicle Titling Information System (NMVTIS) report for any used vehicle offered for sale. If the report shows a branded title, you must display a warning on the vehicle.