Getting a used car dealer license in New York

In New York, used-car dealers are licensed by New York DMV Office of Vehicle Safety and Clean Air.

Before your first retail sale you’ll need a $20,000 surety bond and a business location that meets the state’s rules. The state also inspects the location.

This page gathers what a new independent lot needs, each fact linked to the official source it came from.

Sources checked · details re-checked against official sources

At a glance

License
Retail motor vehicle dealer registration (used vehicles) dmv.ny.gov (source, opens in a new tab)
Issued by
New York DMV Office of Vehicle Safety and Clean Air dmv.ny.gov (source, opens in a new tab)
Surety bond
$20,000 if anticipated annual sales are 50 vehicles or fewer; $100,000 above 50. New applicants should use their expected volume, not the franchise bond tier. dmv.ny.gov (source, opens in a new tab) That’s the bond’s face amount, not what you pay: a surety company charges a yearly premium, usually a small percentage of it, set mainly by your credit.
Official fees
VS-1DI states $587.50 application/business fees for motor vehicle dealer application. dmv.ny.gov (source, opens in a new tab)
Site inspection
Yes. A DMV automotive facilities inspector visits the site to check it meets the facility standards and that the dealer sign is clearly visible. dmv.ny.gov (source, opens in a new tab)

Step by step

  1. Make sure you need a retail dealer registration

    Selling used cars to the public in New York takes a retail motor vehicle dealer registration from the DMV's Office of Vehicle Safety and Clean Air. Franchised (new) dealers, wholesale dealers, brokers and repair shops register differently. dmv.ny.gov › open-a-dealership (source, opens in a new tab) dmv.ny.gov › vs142.pdf (source, opens in a new tab)

  2. Get your sales tax Certificate of Authority first

    You need it before you apply, so start here. Then set up the business entity or DBA, gather ID for every owner, and arrange workers' compensation if your employees require it. Keep the word “Wholesale” out of a retail business name. dmv.ny.gov › open-a-dealership (source, opens in a new tab) dmv.ny.gov › vs142.pdf (source, opens in a new tab)

  3. Set up the location

    You need a display lot separated from any other business by a clear, permanent physical barrier, plus heat, electricity, a desk and chairs, a mailbox at the business address used only by your business, and a business phone (a cell phone is acceptable). Have a lease or proof of ownership. dmv.ny.gov › open-a-dealership (source, opens in a new tab) dmv.ny.gov › vs142.pdf (source, opens in a new tab)

  4. Put up the official dealer sign

    It has white lettering on a red background, is at least 3 feet wide by 2 feet tall, and is permanently mounted where it's visible at all times from the nearest street or highway. dmv.ny.gov › open-a-dealership (source, opens in a new tab)

  5. Choose the bond for your expected sales

    The bond is $20,000 if you expect to sell 50 or fewer vehicles a year and $100,000 above that, so base it on your expected volume, and plan ahead for the fivefold jump if you'll pass 50. You don't pay that amount: a surety company charges you a premium, a fraction of it, set mainly by your credit. dmv.ny.gov › open-a-dealership (source, opens in a new tab)

  6. Apply

    File the Original Facility Application (VS-1DI), working through the VS-142 dealer checklist, with the bond and any workers' compensation documents. The application and business fees are $587.50. Sign by hand (a typed or stamped signature isn't accepted) and don't pay with starter checks. dmv.ny.gov › vs1di.pdf (source, opens in a new tab) dmv.ny.gov › vs142.pdf (source, opens in a new tab)

  7. Review and inspection

    The application is reviewed in Albany, then a DMV automotive facilities inspector visits the site to check it meets the facility standards and that the dealer sign is clearly visible. dmv.ny.gov › open-a-dealership (source, opens in a new tab) dmv.ny.gov › vs142.pdf (source, opens in a new tab)

  8. Finish onboarding before your first sale

    After approval and registration, complete VERIFI onboarding before you process any transactions. dmv.ny.gov › open-a-dealership (source, opens in a new tab) dmv.ny.gov › vs142.pdf (source, opens in a new tab)

The location

Display lot
A display lot, separated from any other business by a clear and permanent physical barrier. dmv.ny.gov (source, opens in a new tab)
Office
Heat, electricity, a desk and chairs; a mailbox at the business address used only by your business; and a business phone (a cell phone is acceptable). dmv.ny.gov (source, opens in a new tab)
Sign
The official dealer sign: white lettering on a red background, at least 3 feet wide by 2 feet tall, permanently mounted and visible at all times from the nearest street or highway. dmv.ny.gov (source, opens in a new tab)

Before you apply

Sales-tax Certificate of Authority before applying; entity/DBA evidence; owner IDs; lease or ownership proof; workers compensation where employees require it. dmv.ny.gov (source, opens in a new tab)

Forms

VS-1DI Original Facility Application; VS-142 dealer checklist (06/25); CR-78 dealer regulations. Bond and workers-comp documents also required. dmv.ny.gov (source, opens in a new tab)

Get the current versions from dmv.ny.gov; we don’t host copies.

Not the license you’re after?

Franchised/new dealer, wholesale dealer, automobile broker and repair-shop registrations have different scope. dmv.ny.gov (source, opens in a new tab)

What trips people up

Our read of the requirements above, not official guidance or statistics.

The hardest part: planning for the fivefold bond increase when expected annual sales exceed 50.

Easy mistakes:

Questions

How much does a New York dealer registration cost?

The DMV's application and business fees are $587.50. You also pay a premium on the bond, $20,000 or $100,000 depending on your expected sales, plus the costs of the location and the dealer sign. dmv.ny.gov › vs1di.pdf (source, opens in a new tab) dmv.ny.gov › open-a-dealership (source, opens in a new tab)

Which bond do I need?

$20,000 if you expect to sell 50 or fewer vehicles a year, $100,000 if you expect more. Use your expected volume. dmv.ny.gov › open-a-dealership (source, opens in a new tab)

Can my cell phone be the business phone?

Yes. The DMV accepts a cell phone as the business phone. dmv.ny.gov › open-a-dealership (source, opens in a new tab)

What does the dealer sign have to look like?

White letters on a red background, at least 3 feet wide by 2 feet tall, permanently mounted and visible at all times from the nearest street or highway. dmv.ny.gov › open-a-dealership (source, opens in a new tab)

Sources

Not affiliated with the New York DMV. Not legal advice. Requirements change; always confirm with the state.