Car Dealer’s License: Did you know there are 3 kinds?



When I first heard of a car dealer license, I thought it’s just a piece of paper that will let me sell cars and not get me thrown in jail. People would walk through the door and see my paper and go “Yup, he’s licensed.”

Here is a quick look at what a car dealer’s license looks like. Remember, it will vary from state to state.

My dear readers, there are, in fact, 3 different licensing models; 3 different types of paper you can proudly hang on your wall:

1)   Wholesale Car Dealer License

2)   Retail Car Dealer License

3)   Car Broker License

To be perfectly honest, each license gives you a tad bit more than the previous one. By the way, in order to get one, you may have to get the one before it. For example, if you want to be an auto broker, you need a retail license first.

Still, here is a look at each of the different licensing models, and a few of the benefits each can give you.

1 – Wholesale Car Dealer License

A wholesale car dealer license gives you the authority to sell your cars to other wholesalers and car dealers as well. This is the cheapest license and has a number of benefits.


  • Ø You don’t need a fancy office or building


  • Ø You don’t need to be ‘bonded’


  • Ø You can sell cars to quite a lot of people


  • Ø The License is an entry pass for special car auctions (Cool right?).

2 – Retail Car Dealer License

A retail car dealer license is better than a normal wholesale car dealer license. A retail car dealer license lets you not only sell to wholesalers and retailers, but to normal people as well; people like you and me.

This license comes with all the benefits of a wholesale license and then some. Added benefits include:

  • Ø You can sell to many more customers


  • Ø More customers equals MORE MONEY!


  • Ø People will trust you when they see a laminated piece of white paper hanging on the wall. Totally legit right?

3 – Car Broker License

The final type of car dealer license is known by many names; licensed dealer, qualified dealer, auto broker or car broker. Let’s just keep it simple and just call it a car broker license. It’s practically the same as a retail license but you do get more benefits.

Normally, you would buy a car, flip it and sell it right? Well, with a car broker license, the state will let you take cars from your customers and sell the car for them. So what do you get? A share of the profits!

The great thing is it only costs a few bucks extra to change from retail to car broker license.

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