How to Get an Auto Dealer License in Louisiana: Complete Step-by-Step Guide
Thinking about opening a used car dealership in Louisiana?
Before you can legally start buying and selling vehicles as a dealer, you'll need to meet Louisiana's licensing requirements. For a used motor vehicle dealership, the licensing process is handled by the Louisiana Used Motor Vehicle Commission (LUMVC). Louisiana also has a separate Louisiana Motor Vehicle Commission (LMVC) that regulates new motor vehicle dealers and other automotive businesses.
The process involves establishing a compliant business location, completing the required application, obtaining a $50,000 dealer surety bond, securing garage liability insurance, completing zoning verification, having the required business sign and telephone service, obtaining a salesperson license, and completing the required educational seminar.
This guide walks you through the major steps to get a Louisiana used auto dealer license.
Important: Requirements and fees can change. The information below is based on the current LUMVC materials available at the time of writing. Always verify the current requirements with the Louisiana Used Motor Vehicle Commission before submitting an application.
Step 1: Determine What Type of Dealer License You Need
Louisiana regulates several different types of automotive businesses.
For someone planning to operate a traditional independent used car dealership, the relevant license is generally the Used Dealer's License issued through the Louisiana Used Motor Vehicle Commission.
The LUMVC's licensing rules cover used motor vehicle dealers, used vehicle auctions and salvage pools, brokers of used motor vehicles, and several other automotive businesses.
The initial dealer application allows applicants to select the types of used vehicles they plan to deal in, including:
Used cars and trucks
Used boats
Used boat motors
Used trailers
Used motorcycles
Used motorhomes
Used golf carts and ATVs/off-road vehicles
Used buses, fire trucks and wreckers
If you're opening a standard independent used car lot, make sure you're applying for the license that matches your actual business activities.
Step 2: Establish Your Business
Before applying, you'll need to establish the business itself.
If you're operating as an LLC, corporation, LP, or LLP, the LUMVC application packet says the business must be registered with the Louisiana Secretary of State.
Your business name is especially important.
The LUMVC requires the business name to match across your documents, including your:
Dealer application
Business sign
Telephone listing
Other licensing documents
A mismatch between documents can delay your application.
Step 3: Secure an Established Place of Business
Louisiana requires a used motor vehicle dealer to have an established place of business.
The LUMVC defines this as a permanently enclosed building or structure that is owned, leased, or rented, complies with local zoning or municipal requirements, is regularly occupied for the business, is accessible to the public, and maintains the books, records, and files required for the business. Temporary locations such as tents and temporary stands don't qualify.
This means you shouldn't assume you can simply operate your dealership from your home or an informal parking lot.
Your location needs to satisfy the state's requirements and local zoning requirements.
Step 4: Get Your Location Approved for Zoning
Before submitting your application, you'll need to address local zoning requirements.
The LUMVC's initial dealer packet requires a Zoning Verification Form completed by your local zoning authority.
The location must comply with applicable local zoning laws or municipal requirements, and the zoning code must be identified when applicable.
This is one of the steps you should handle early.
Imagine signing a long-term lease and then discovering that the property isn't properly zoned for a used automobile dealership.
You could end up paying for a location you can't use.
Check zoning before committing to the property.
Step 5: Install Your Required Business Sign
Louisiana has specific requirements for your dealership's business sign.
According to the LUMVC's initial dealer requirements, the dealership must have a permanently affixed sign displaying the exact trade name of the business.
The sign must:
Be permanently attached
Display the exact trade name
Be located in front of the business
Be clearly visible from the street or roadway
Be at least 16 square feet, or 4 feet by 4 feet
You'll also need to provide a picture of the sign with your dealer application.
Make sure the name on the sign exactly matches the name used throughout your application and other documents.
Step 6: Set Up Your Business Telephone
The LUMVC also requires a business telephone.
The initial dealer packet states that the business phone must be listed with Nationwide Directory Assistance (411) under the business name and address.
The telephone must remain connected and working, and the LUMVC allows either a landline or cellular phone.
This is another detail that's easy to overlook when preparing your dealership location.
Step 7: Complete the Dealer Application
Next, you'll need to complete the Louisiana Used Motor Vehicle Commission's Dealer Application.
The application requests information about the dealership, including:
Business name
Physical address
Mailing address
Business phone
Email address
Ownership structure
Owners
Driver's license information
Business history
Background information
Previous dealer licenses
Other relevant licensing information
The application packet specifically warns that incomplete or inaccurate information can delay the licensing process.
Take your time when completing the application.
Step 8: Get Your Louisiana Dealer Surety Bond
One of the most important requirements is your Louisiana used motor vehicle dealer surety bond.
The LUMVC's current initial dealer packet specifies a $50,000 surety bond for a used motor vehicle dealer.
The bond must:
Be in the amount of $50,000
Show the bond number
Match the principal's legal ownership
Match the dealership's trade name
Match the physical business address
Identify the ownership type
Show effective and ending dates
Be made in favor of the State of Louisiana through the LUMVC
Remain in force throughout the license period
Be signed by the principal
Be signed by the surety
Include the surety's seal
Include the required Power of Attorney
The official bond form states that the $50,000 bond is required under Louisiana Revised Statute 32:791 and is effective for the applicable license period.
What does the dealer bond do?
A dealer bond is not insurance for your dealership.
Instead, it's a financial guarantee designed to protect qualifying parties against certain losses resulting from violations of applicable dealer laws and obligations.
The LUMVC bond language specifically addresses matters including certain losses involving taxes, license fees, tags, certificates of title, registration requirements, purchaser losses, commission-ordered restitution, certain penalties and costs, and other specified obligations.
How much does a $50,000 bond cost?
You don't normally pay $50,000 for the bond.
The $50,000 is the bond amount, not necessarily the premium you'll pay.
Your actual premium depends on factors such as your credit and underwriting profile.
Step 9: Get Garage Liability Insurance
Louisiana also requires proof of garage liability insurance for the used dealer license.
The LUMVC's initial dealer packet requires an Acord Certificate of Liability Insurance showing the required information and a minimum limit of $55,000.
The certificate needs to identify the insured, physical address, insurance company, agency, policy number, effective and expiration dates, and other information required by the LUMVC.
The certificate holder must be:
Louisiana Used Motor Vehicle Commission
with the Commission's Baton Rouge address shown in the LUMVC requirements.
Your insurance agent should be familiar with the certificate requirements so the documentation is prepared correctly.
Step 10: Obtain a Salesperson License
Each Louisiana used dealership must have at least one salesperson.
The LUMVC initial dealer packet specifically includes salesperson applications as part of the used dealer license checklist.
The current fee schedule in the LUMVC packet lists the salesperson license fee at $25 with a one-year term.
If you have employees who will actually perform activities requiring a salesperson license, make sure you understand which employees need to be licensed before they begin performing those duties.
Step 11: Complete the Required Educational Seminar
Louisiana requires certain new applicants to complete a four-hour educational seminar.
For a new used motor vehicle dealer, one of the following representatives must attend:
Owner
General manager
Office manager
Title clerk
Other responsible representative of the business
The LUMVC says new applicants must complete the seminar before obtaining the license or provide proof that they have registered for it. New applicants must then attend within 60 days of license issuance.
The Commission currently lists the seminar as being conducted virtually through Microsoft Teams.
This is an important step because missing the required seminar can create compliance problems after licensing.
Step 12: Prepare Your Complete Application Packet
Before submitting your application, make sure you've assembled everything required.
For a standard used dealer license, the LUMVC checklist includes:
Completed dealer application
Salesperson application(s)
Zoning verification
Picture of the business sign
Business phone
Required fees
The LUMVC also provides an official Initial Dealer Packet and separate forms for the dealer application, salesperson application, surety bond, zoning verification, and other requirements.
Step 13: Pay the Required Licensing Fees
The LUMVC's published initial packet lists the following fees:
License | Fee |
Used Dealer License | $400 |
Additional Location | $200 |
Additional Adjacent Location | $200 |
Salesperson License | $25 |
The packet lists the used dealer license with a two-year term, while salesperson licenses have a one-year term.
The LUMVC states that initial licenses cannot currently be applied for online and that payment may be made by cash, check, money order, and/or cashier's check payable to the Louisiana Used Motor Vehicle Commission.
Because fees and licensing periods can change, verify the current fee schedule before submitting your application.
Step 14: Submit Your Application to the LUMVC
Once everything is complete, submit your application and supporting documentation to the Louisiana Used Motor Vehicle Commission.
The Commission's current materials say applications are processed in the order received and applicants should allow approximately 14 business days for processing.
Submitting an incomplete application can delay the process.
The LUMVC may also send a "sendback" requesting additional documentation if something is missing or needs to be corrected.
Step 15: Pass the Physical Inspection
Getting the paperwork submitted isn't necessarily the end of the process.
The LUMVC states that a physical inspection will be conducted before licenses are issued.
This is why you should have your dealership location completely ready before applying.
Your:
Business location
Sign
Phone
Zoning
Required records
Other physical requirements
should all be in order.
Don't treat the application as the time to start getting the location ready.
Have the dealership prepared before the inspection.
Step 16: Receive Your Louisiana Dealer License
Once your application is approved and the required steps are completed, the LUMVC issues your dealer license.
The LUMVC rules state that a dealer's license is issued in the legal name identified on the application and includes the dealership's name, address, and assigned dealer number.
The license should be posted in a conspicuous place at the dealership.
Once properly licensed, the dealer has the authority provided under Louisiana law for licensed used motor vehicle dealers, including purchasing and selling used motor vehicles and handling titles as permitted by law.
How Long Does It Take to Get a Louisiana Dealer License?
The LUMVC's initial dealer packet says applicants should allow approximately 14 business days for processing once the application is received.
However, that doesn't necessarily mean you'll be licensed exactly 14 business days after starting the process.
You still need to:
Find a compliant location
Verify zoning
Install the required sign
Establish your business phone
Complete applications
Complete or register for the educational seminar
Submit the complete packet
Complete the physical inspection
Missing documents or corrections can add additional time.
How Much Does It Cost to Get a Louisiana Dealer License?
The state licensing fee is only one part of the total startup cost.
For a used dealer, you should budget for:
$400 dealer license fee
$25 salesperson license
$50,000 surety bond requirement — this is the bond amount, not the amount you necessarily pay
Business location
Zoning-related costs
Required sign
Business telephone
Business formation costs
Dealer plates, if needed
Inventory
Reconditioning
Advertising
Other dealership startup expenses
The LUMVC's current dealer plate information says dealer inventory plates are available after receiving the dealer license. The initial plate cost is currently listed as $15 per plate, with up to three plates per dealer license plus one additional plate per licensed and insured salesperson.
What Is the Louisiana Dealer Bond Used For?
The dealer bond is one of the most important parts of the licensing process.
The $50,000 bond is designed to provide a financial remedy for certain qualifying losses and obligations involving the dealer.
The official LUMVC bond form specifically references obligations involving:
Taxes
License fees
Tags
Certificates of title
Registration
Sales tax
Purchaser losses
Commission-ordered restitution
Certain fines and penalties
Certain attorney fees and court costs
It's important to understand that a surety bond is different from insurance.
If the surety pays a valid claim under the bond, the dealer may ultimately be responsible for reimbursing the surety.
Dealer Bond vs. Dealer Insurance
These two requirements serve different purposes.
The bond helps protect qualifying parties and provides a guarantee that the dealer will comply with applicable obligations.
Insurance helps protect the dealership against covered liability risks according to the terms, conditions, exclusions, and limits of the policy.
You shouldn't think of one as a replacement for the other.
The bond helps you satisfy a licensing requirement. Insurance helps protect your business from covered risks.
Common Mistakes When Applying for a Louisiana Dealer License
Choosing a Location Before Checking Zoning
This can create a major problem.
Always verify that the property can legally be used for your intended dealership operation.
Using Different Business Names
Your business name needs to be consistent across your application, bond, insurance, sign, phone listing, and other documents.
Getting the Wrong Bond
The LUMVC requires the bond to follow its required form or exact language and contain specific information.
Don't simply buy a generic bond without confirming that it meets the Commission's requirements.
Waiting Until the Last Minute to Get Insurance
Your certificate of insurance needs to contain specific information.
Give your insurance agency enough time to prepare it correctly.
Forgetting the Educational Seminar
The seminar is a licensing requirement for new applicants.
Make sure the appropriate representative is registered and completes it within the required timeframe.
Submitting an Incomplete Application
An incomplete application can delay approval.
Use the LUMVC checklist and verify every item before submitting.
Can You Get a Louisiana Dealer Bond With Bad Credit?
Your credit can affect how a surety company evaluates your application and determines your bond premium.
However, having less-than-perfect credit doesn't automatically mean you can't obtain a dealer bond.
Surety companies evaluate applications differently, and available options depend on your overall financial and credit profile.
If you're concerned about your credit, it's worth speaking with a surety bond professional before assuming you won't qualify.
What Happens After You Get Your License?
Getting licensed is only the beginning.
Once you're operating, you need to keep your dealership compliant.
That includes:
Keeping your business information current
Maintaining required records
Keeping licenses current
Properly handling titles
Properly handling taxes and fees
Maintaining required salesperson licenses
Following Louisiana dealer laws and regulations
The LUMVC rules also establish annual renewal procedures and expiration requirements.
Don't wait until your license is about to expire to start thinking about renewal.
Start Your Louisiana Dealership the Right Way
Getting an auto dealer license in Louisiana requires more than filling out an application.
You need the right business location, zoning approval, sign, telephone, insurance, surety bond, salesperson licensing, educational seminar, documentation, and inspection.
The good news is that the process becomes much easier when you break it down into individual steps.
The most important thing is to prepare before you apply.
Get your location right.
Get your documents right.
Then submit a complete application.
Need a Louisiana Dealer Bond or Insurance?
If you're preparing to open a dealership in Louisiana, All American Bonds and Insurance can help you with the bond and insurance requirements you'll need to operate your business.
We specialize in:
We've helped independent dealers across the country with their bonding and insurance needs.
📞 844-321-2663📧 info@quickerbonds.com🌐 www.QUICKERBONDS.com
Get your Louisiana dealer bond and insurance requirements handled so you can focus on building your dealership.
Frequently Asked Questions
How do I get an auto dealer license in Louisiana?
For a used motor vehicle dealership, you'll generally need to establish a compliant business location, satisfy zoning requirements, obtain the required $50,000 surety bond and garage liability insurance, complete the dealer and salesperson applications, complete the required educational seminar, pay the applicable fees, submit your application, and pass the required physical inspection.
How much is a Louisiana used car dealer bond?
The LUMVC requires a $50,000 surety bond for a used motor vehicle dealer. The $50,000 is the bond amount; the premium you pay for the bond is typically only a percentage of that amount and depends on underwriting factors.
How much is a Louisiana dealer license?
The LUMVC's published initial packet lists the used dealer license fee at $400, with a $25 salesperson license fee. Additional locations are listed at $200. Verify current fees with the LUMVC before applying.
Does Louisiana require dealer insurance?
Yes. The LUMVC's initial used dealer requirements call for garage liability insurance with minimum limits of $55,000 and a certificate meeting the Commission's requirements.
Does Louisiana require a physical dealership location?
Yes. A used motor vehicle dealer must have an established place of business that meets the Commission's requirements, including local zoning or municipal requirements.
Does Louisiana require dealer education?
Yes. New applicants for a used motor vehicle dealer license must have an appropriate representative attend the required four-hour educational seminar. The LUMVC says new applicants must complete it before licensing or provide proof of registration, and must attend within 60 days of license issuance.
How long does it take to get a Louisiana dealer license?
The LUMVC's initial dealer packet says to allow approximately 14 business days for application processing, although the total timeline can be longer depending on how quickly you complete the prerequisites and whether the Commission requests additional information.
Who issues used car dealer licenses in Louisiana?
Used motor vehicle dealer licenses are issued through the Louisiana Used Motor Vehicle Commission (LUMVC). New motor vehicle dealers and certain other automotive businesses are regulated by the Louisiana Motor Vehicle Commission.
Comments