The Tennessee Motor Vehicle Commission handles all new Tennessee dealer license applications. To become a car dealer in Tenneessee, you must first meet the requirements: Requirements for eligiblity.
You are legally allowed to sell up to 5 vehicles a year without a Tennessee Dealer License, as long as those vehicles are registered in your name. (Check out the bill that mentions this rule.) If you wish to flip vehicles for a profit, you will need to get a dealer license.
Not sure if you need a dealer license? Check out this post on selling cars without a license.
How to Become a Car Dealer in Tennessee
Step #1: Establish a place of business
Temporary facilities and residents are prohibited. Your place of business must meet the following requirements:
- Facility – 288 square feet, provide restroom accommodations
- Display lot – Capable of holding 15 vehicles for sale and 3 for customer parking
- Signage – letters a minimum of 8 inches in height, must contain entire dealership name
Step #2: Get place of business inspected
Inspection must be conducted by an Area Field Investigator.
To schedule an inspection, call the Tennessee Motor Vehicle Commission at (615) 741-0651.
If you do not pass this inspection, your Tennessee dealer license application (Step #3) will not be complete.
For a further, more detailed list of exact specifications for the above requirements, reference the Tennessee Dealer License Application Requirements.
Step #3: Complete a Tennesee Dealer Application
Note that Tennessee does not have a license classification for wholesale, broker, or exporter licenses.
Worried about a previous felony? Check out this post on Getting a Dealer License With a Felony.
Step #4: Purchase a Tenneessee Motor Vehicle Dealer Bond
The bond amount is set at $50,000.
You will not pay the full bond amount.
You will pay 1-15% of the bond amount ($500 – $7,500) depending on your personal credit score. This will be a one-time payment, not a monthly payment.
To see what you would pay for a Tennessee Dealer Bond, get a free quote:
Have bad credit? We can still get you bonded. Check out our bad credit options.
Nervous about paying for your bond? We can help you finance.
Step #5: Submit other paperwork
Step #6: Pay Fees
Pay via check or money order. Make orders payable to the “Tennessee Motor Vehicle Commission.”
Fees paid in cash must be paid in person.
- New/used vehicle dealer: $400
- Salesperson license: $35
- Change of employer endorsement: $35
- Motor vehicle show permit: $200
Step #7: Submit
Submit your TN Dealer License Application to the address listed on the application.
Upon approval, you will receive your Tennessee Auto Dealer License in the mail within 7-10 working days.
Take the License Certificate to your local County Clerk to be recorded. Normally after recording, the Clerk will issue dealer registration license plates.
Reasons Your Tennessee Dealer License Application Would Be Denied
- Dealer does not sign TN Motor Vehicle Dealer Bond
- Dealer does not send the original TN Motor Vehicle Dealer Bond
- The expiration date of the TN Motor Vehicle Dealer Bond is wrong:
The expiration date of the bond must be two years from the last day of the month the application is submitted. For example, if you submit your application on March 12th, 2015, the expiration date should be March 31st, 2017.The surety bond company you buy your bond from should help you with the correct bond date.
- Financial statement not done by CPA
- Questions not fully answered on application
- Proper pictures not included in application
License Expiration and Renewal
To remain in compliance with the law, renewal paperwork must be received by the Tennessee Motor Vehicle Commission at least 10 days prior to your license expiration date.