How to Get a Dealer License in Pennsylvania in 9 Easy Steps

In Pennsylvania, all motor vehicle dealers must be licensed and bonded to legally sell vehicles. The State Board of Vehicle Manufacturers, Dealers, and Salespersons oversees the licensing process, ensuring compliance with state regulations. Dealers must choose the appropriate license type—such as new, used, motorcycle, or miscellaneous dealer—based on their business model.

Additionally, dealerships must meet business location, bonding, and operational requirements before applying. Follow these steps to apply for your Pennsylvania auto dealer license:

Step 1: Determine the Type of Dealer License Needed

In Pennsylvania, the State Board of Vehicle Manufacturers, Dealers, and Salespersons issues various types of dealer licenses. Identifying the appropriate license is crucial for compliance. The main categories include:

• New Vehicle Dealer: Authorized to sell new vehicles.
• Used Vehicle Dealer: Authorized to sell pre-owned vehicles.
• Motorcycle Dealer: Specializes in selling motorcycles.
• Auction Dealer: Authorized to sell motor vehicles at auctions only.
• Miscellaneous Dealer: Includes businesses such as repair and towing services, vehicle salvage, transporters, financiers or collector-repossessors, and watercraft trailer dealers.

Each license type has specific requirements and permissions.

Step 2: Create a PALS Account

Pennsylvania uses the Pennsylvania Licensing System (PALS) for professional licensing applications. To begin the dealer licensing process:

• Visit the PALS portal.
• Click on “Register” to create a new account.
• Follow the prompts to enter your personal and business information.
• Once registered, log in to your account to access the dealer license application.

This account will be used to submit applications, track statuses, and manage license renewals.

Step 3: Complete the Dealer Application

After setting up your PALS account, proceed to complete the dealer application. Ensure you have the following documentation:

• Business Information: Legal business name, address, and contact details.
• Ownership Details: Names and titles of all owners, partners, or corporate officers.
• Business Location: Proof of a permanent business location that meets all state requirements, including:
  • A display area capable of showing at least five vehicles with doors fully open, separate from customer parking
  • An office equipped with a desk, chair, and lockable filing cabinet
  • A telephone line with a publicly listed number located inside the business building
  • A permanent sign displaying the business name, connected to the building or display area
  • Posted business hours visible to customers
  • A certificate of occupancy from your local building inspection authority
• Facility Diagram: A hand-drawn, labeled, signed, and dated diagram of your dealership premises on 8½” × 11” paper, showing dimensions of all buildings, office and display areas, customer parking locations, and any other businesses or residences on the property. This is required as part of your PALS submission.
• Property Documentation: A deed or a minimum 6-month lease for the business location.

Ensure all information is accurate and complete to avoid processing delays.

Step 4: Obtain a Pennsylvania Auto Dealer Surety Bond

Under Pennsylvania Consolidated Statutes Title 63, Section 818.11, motor vehicle dealers must file a surety bond with the State Board before receiving a license. The required bond amount depends on your license type:

• $20,000: Motor vehicle dealers and manufacturers who sell vehicles only.
• $30,000: Dealers or full agents who will also be issuing temporary registration cards and plates (required per business location). If your dealership will issue temp plates, you need the $30,000 bond, not $20,000.
• $10,000: Motor vehicle salvors.
• $3,000: Card agents.

This bond serves as a financial guarantee that the dealer will adhere to state laws and ethical business practices. The original bond document must be submitted with your dealer application — the Board does not accept copies. To obtain the bond:

• Go to our dedicated Pennsylvania Auto Dealer Bond page.
• Submit an application.
• Pay the bond premium, which is a percentage of the total bond amount.
• Include the original bond document with your dealer application.

The premium you pay typically ranges from 1% to 3% of the bond amount, depending on your credit score and financials.

Step 5: Provide Criminal History Records

All owners, partners, or corporate officers must submit an original criminal history record obtained from the Pennsylvania State Police using Form SP 4-164. The fee for each record is $22. Important requirements:

• Records must be dated within 180 days of the application date — older records will not be accepted.
• You must submit a criminal history record from every state in which each person has lived, worked, or trained in the past 5 years, not just Pennsylvania.
• Only original records are accepted — no copies or digital prints.

To acquire the Pennsylvania record, visit the PATCH website, request and pay for the background check, and submit the original results with your dealer application.

Step 6: Ensure Facility and ADA Compliance

Your dealership must comply with state facility requirements and the Americans with Disabilities Act (ADA). This includes:

• Zoning Compliance: Obtain verification from your local zoning board that your business location is approved for dealership operations.
• Certificate of Occupancy: Secure this certificate from your local building inspection authority, confirming that your facility meets all building codes and is safe for occupancy.
• ADA Compliance: Ensure your facility is accessible to individuals with disabilities, including accessible parking, entrances, and restrooms.

Maintaining compliance is essential for both legal operations and customer accessibility.

Step 7: Submit the Application

With all required documentation prepared, submit your completed application to the State Board of Vehicle Manufacturers, Dealers, and Salespersons. Include all of the following:

• Completed dealer application form
• Original $20,000 surety bond (or $30,000 if issuing temporary registration plates) — original physical bond only, no copies
• Original criminal history records (Form SP 4-164, $22 per person) for all owners, partners, and corporate officers — dated within 180 days, covering all states lived or worked in during the past 5 years
• Proof of business location compliance: zoning verification and certificate of occupancy
• Proof of liability insurance
• Hand-drawn, labeled, signed, and dated facility diagram on 8½” × 11” paper
• Property deed or a minimum 6-month lease
• Three letters of character reference from businesses or employers for each owner and corporate officer
• Credit letter of reference from a bank confirming accounts are in good standing
• Notarized statement that no monies are owed to the Commonwealth of Pennsylvania
• Franchise agreement from the manufacturer (new vehicle dealers only)
• Application fee: $190

Apply through the PALS portal or mail your application and documents to:

State Board of Vehicle Manufacturers, Dealers, and Salespersons

2 Technology Park

Harrisburg, PA 17110-2919

Step 8: Schedule and Pass the Inspection

After your application is reviewed and deemed complete, a representative from the State Board will contact you to schedule an inspection of your dealership facility. To prepare:

• Ensure all signage is properly displayed.
• Verify that the display area meets size and condition requirements.
• Confirm that the office area is appropriately furnished and secure for record storage.

Passing the inspection is a critical step toward obtaining your dealer license. If you do not pass the initial inspection, a $45 reinspection fee is required before a second inspection can be scheduled.

Step 9: Apply for Dealer Plates

Once licensed, apply for dealer plates through PennDOT by submitting Form MV-349 along with the required fee. Dealer plates allow you to legally operate vehicles for business purposes.

Pennsylvania Dealer License Renewal

Dealership licenses in Pennsylvania expire on May 31 of each odd-numbered year — making the license term two years. Renew your license before the expiration date via PALS. If you don’t, your ability to legally operate your dealership will be suspended until you come into compliance.

Key renewal requirements:

• Renew every two years via PALS before May 31 of each odd-numbered year
• Pay the biennial renewal fee of $274
• Keep your surety bond active — if your bond lapses, your dealer license becomes inactive, and you cannot legally sell vehicles until it is reinstated
• Keep your liability insurance current
• Maintain proper sales records and stay compliant with the Pennsylvania Vehicle Code

Renewal fees:

How Much Does a Pennsylvania Dealer License Cost?

The application fee for a Pennsylvania auto dealer license is $190. The total cost of getting licensed includes several additional fees:

Apart from these fees, additional costs cover business registration, business insurance, and individual dealer plates.

Common Mistakes to Avoid When Getting a Pennsylvania Dealer License

Avoiding these mistakes can save time, money, and prevent application rejections:

• Submitting an incomplete application – missing documents like criminal history records, surety bond certificates, or zoning approvals can delay approval. Always double-check requirements before submitting.
• Not meeting business location requirements – your dealership must have a permanent location, a designated display area for at least five vehicles, and proper signage.
• Failing the inspection – ensure your office, signage, and vehicle display area meet state standards before the State Board inspection.
• Not maintaining surety bond & insurance – your surety bond and liability insurance must remain active. Failure to renew can result in license suspension.
• Ignoring compliance regulations – keep detailed sales records, follow the Pennsylvania Vehicle Code, and renew your license every two years to avoid fines or penalties.

Can I Get a Dealer’s License Without a Lot in Pennsylvania?

In Pennsylvania, obtaining a dealer’s license requires a physical location or lot. The application must include details of the principal place of business, a certificate of occupancy, and a lease or deed for the property.

If you can’t obtain a large lot, at least in the beginning, you need to have a separate business location with a permanent office next to a display area. Requirements include, as mentioned in step #3, a designated display area for at least five vehicles, a lockable file cabinet, desk, and phone in the office, and a permanent sign showing your dealership name and hours. You will also need to comply with zoning laws and have a Certificate of Occupancy from the Department of Labor and Industry.

Ensure you meet all licensing requirements before applying.

FAQs

How many cars can you sell in Pennsylvania without a dealer license?

Pennsylvania law does not specify a fixed number of vehicles. However, if you are in the business of buying or selling vehicles — even casually and frequently — the State Board may consider you a dealer and require licensure. To avoid any ambiguity, consult the State Board of Vehicle Manufacturers, Dealers, and Salespersons if you plan to regularly sell vehicles.

How long does it take to get a Pennsylvania dealer license?

The timeline varies depending on how quickly you can gather all required documents and pass the facility inspection. The State Board may issue a 60-day temporary certificate of authorization if additional review time is needed. In practice, applicants should allow 30 to 60 days from the date of submitting a complete application to receiving the license.

Can I sell cars from my home in Pennsylvania?

No. Pennsylvania requires all dealers to operate from a permanent, private facility that complies with local zoning ordinances and holds a certificate of occupancy. A residential address does not qualify as an established place of business for dealer licensing purposes.

Do salespeople need their own license in Pennsylvania?

Yes. In Pennsylvania, any individual who sells vehicles on behalf of a licensed dealer must hold a separate Salesperson License issued by the State Board of Vehicle Manufacturers, Dealers, and Salespersons. The salesperson application is also submitted through PALS and requires a criminal history record.

What happens if I operate as a dealer without a license in Pennsylvania?

Operating as an unlicensed dealer in Pennsylvania is a violation of the Pennsylvania Vehicle Code. The State Board may pursue civil and administrative action, including fines and prohibition from future licensure. Unlicensed dealing may also expose you to criminal liability under Pennsylvania consumer protection laws.

Who regulates dealer licensing in Pennsylvania?

Dealer licensing is handled by the Pennsylvania State Board of Vehicle Manufacturers, Dealers, and Salespersons, which is part of the Department of State’s Bureau of Professional and Occupational Affairs. PennDOT handles dealer plates separately. The two agencies have distinct roles — your license comes from the State Board, while your plates come from PennDOT.