Getting a used car dealer license in Rhode Island

In Rhode Island, used-car dealers are licensed by Rhode Island DMV Dealers License and Regulations Office.

Before your first retail sale you’ll need a $50,000 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.

At a glance

License
Motor Vehicle Dealer, Used Vehicles Only dmv.ri.gov (source, opens in a new tab)
Issued by
Rhode Island DMV Dealers License and Regulations Office dmv.ri.gov (source, opens in a new tab)
Surety bond
$50,000 bond; separate $50,000 bank credit line also required. dmv.ri.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
$303.50 license payment. dmv.ri.gov (source, opens in a new tab)
Renewal
Three-year license; annual updates and $303.50 per location. dmv.ri.gov (source, opens in a new tab)
Site inspection
Yes: agency investigation and investigator completion before issuance; confirm appointment sequence. dmv.ri.gov (source, opens in a new tab)

Step by step

  1. Make sure you need a used-only dealer license

    Rhode Island's DMV Dealers License and Regulations Office issues the Motor Vehicle Dealer, Used Vehicles Only license. Franchise, lease and rental, and annex licenses differ. dmv.ri.gov › download (source, opens in a new tab)

  2. Get your name and site approved first

    The agency approves your business name and site before anything else. A used dealer's name needs “Auto Sales” in it. dmv.ri.gov › download (source, opens in a new tab)

  3. Set up the premises

    You need 2,400 sq ft of outside display and a 2,400 sq ft enclosed, heated building with repair facilities and an installed phone, plus a 24 sq ft name sign (local ordinances can allow an exception). Get a municipal second-hand license or a zoning letter. dmv.ri.gov › download (source, opens in a new tab) dmv.ri.gov › download (source, opens in a new tab)

  4. Line up the money: bond and credit line

    You need a $50,000 surety bond and, separately, a $50,000 bank line of credit; the bond doesn't count as the credit line. Add a financial statement prepared by a CPA. You don't pay that amount: a surety company charges you a premium, a fraction of it, set mainly by your credit. dmv.ri.gov › download (source, opens in a new tab)

  5. Put the packet together

    The new dealership application packet includes the financial and employee forms, the bond, a BCI background check for each owner (plus other states if you've lived elsewhere recently), entity documents and your sales tax permit. dmv.ri.gov › download (source, opens in a new tab)

  6. Investigation and hearing

    The agency investigates, an investigator visits before issuance, and your application goes to a hearing. dmv.ri.gov › download (source, opens in a new tab)

  7. Finish within 30 days, then the final appointment

    After the hearing you have 30 days to finish the sales tax, sign, insurance (the GU1338 filing), bill-of-sale approval and the $303.50 fee. Then comes the final appointment. dmv.ri.gov › download (source, opens in a new tab)

  8. Keep it current

    The license runs three years, with annual updates and $303.50 per location. dmv.ri.gov › download (source, opens in a new tab)

The location

Display lot
2,400 sq ft outside display. dmv.ri.gov (source, opens in a new tab)
Office
2,400 sq ft enclosed/heated building, repair facilities and installed telephone. dmv.ri.gov (source, opens in a new tab)
Sign
24 sq ft name sign; local ordinance exception in rules. dmv.ri.gov (source, opens in a new tab)
Zoning and home-based lots
Municipal second-hand license or zoning letter. dmv.ri.gov (source, opens in a new tab)

Before you apply

CPA financial statement, credit line, owner BCI (other states if recent/nonresident), entity documents, sales-tax permit and GU1338 insurance filing. dmv.ri.gov (source, opens in a new tab)

Forms

New Dealership application packet, financial/employee forms, bond; GU1338 plate insurance filing. dmv.ri.gov (source, opens in a new tab)

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

Not the license you’re after?

Franchise, lease/rental and annex licenses differ. dmv.ri.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: premises plus separate credit-line and surety requirements.

Easy mistakes:

Questions

How much does a Rhode Island dealer license cost?

$303.50. The bigger costs are the $50,000 bond premium, the $50,000 credit line and 2,400 sq ft of display plus a 2,400 sq ft building. dmv.ri.gov › download (source, opens in a new tab) dmv.ri.gov › download (source, opens in a new tab)

Is the bond enough, or do I need a credit line too?

You need both: a $50,000 bond and a separate $50,000 bank credit line. dmv.ri.gov › download (source, opens in a new tab)

Does my business name matter?

Yes. The agency approves it first, and a used dealer's name needs “Auto Sales”. dmv.ri.gov › download (source, opens in a new tab)

Sources

Not affiliated with the Rhode Island DMV. Not legal advice. Requirements change; always confirm with the state.