Dealer Licensing in Delaware
The Delaware Division of Motor Vehicles (DMV) handles all dealer licensing in the state. Below, we’ll take you through the steps of applying for your DE dealer license.
DE Motor Vehicle Dealer Licenses
The Delaware Division of Motor Vehicles issues licenses for the following types of businesses:
- Dealerships for:
- New vehicles.
- Used vehicles.
- Wholesale vehicles.
- Mobile homes.
- Vehicle auctions.
- Vehicle repossession companies.
We explain the application process for new and used car dealership licenses below; if you need information on the other types of motor vehicle licenses mentioned above, refer to the Delaware DMV’s page on dealership information.
PRIOR to submitting your DE dealer license application, you’ll need to:
- Complete the necessary criminal background checks.
- Obtain a DE business license.
- Get approval from the county zoning office.
We’ll go over these pre-application requirements in this section.
Criminal History Background Check
Whether you’re applying for a new or used car dealer license, all owners and officers at your prospective dealership must undergo a DE criminal history check. Anyone who’s lived in Delaware for under 2 years must ALSO provide a criminal background check from their previous state of residence.
You can complete the criminal history check(s) at any of the Delaware State Bureau of Identification. For more information please call:
- Kent County: (800) 464-4357
- Sussex County: (302) 856.5850
- New Castle County: (302) 739-2528
The cost of a criminal background check is based on whether you’re required to undergo a state check, or a state and federal check:
- Delaware-only fee: $52.
- State and federal fee: $65.
Contact the applicable telephone number above with any questions.
Obtain a Delaware Business License
You must obtain a business license from the Division of Revenue, AND you must attach the receipt to your car dealer license application. If your dealership is located within city or town limits, you also must obtain a city/town business license.
Use the following contact information for details about your dealership’s specific requirements for a business license:
- New Castle County: (302) 577-8200.
- Kent County: (302) 744-1085.
- Sussex County: (302) 856-5358.
Additionally, you can contact the DOR at (800) 292-7826 if you’re currently in Delaware.
As part of your car dealer license application, you’ll need to submit written proof of zoning approval for your proposed dealership location.
Call the planning and zoning office in your business’ county for more information:
- New Castle County: (302) 395-5400.
- Kent County: (302) 744-2471.
- Sussex County: (302) 855-7700.
Apply for a Delaware Car Dealer License
You must have a new or used motor vehicle dealer license if you will be buying, selling, or exchanging at least 5 vehicles within 12 months.
Below are the basic requirements to apply for your DE dealer license. Be sure to read through the DMV’s Dealer Procedures Manual (REV 2017) AND its pages on new car dealerships and used car dealerships for a full understanding of what goes into getting your license.
To apply for your Delaware dealer license, you will need to submit:
- A completed Application for Dealer License (Form MV29).
- Dealer licenses specifically are free, BUT expect to pay additional fees related to other parts of the application process.
- A Signature Authorization (Form MV26).
- A criminal history background check.
- An available business name. The DE DMV checks this information for you.
- Your business license from the Delaware Department of Revenue.
- Proof of “good standing” with the Delaware Division of Corporations regarding the incorporation of your dealership in Delaware.
- Proof of liability insurance showing how many dealer tags are on your policy.
- Written approval from the zoning office.
- A manufacturer’s letter of franchise for each vehicle sold (NEW CAR DEALERS ONLY).
- An entrance permit issued by the Delaware Department of Transportation (DelDOT) if your dealership is located on a road maintained by the state.
- An estimate of the number of vehicles you expect to sell during the 1st year of business.
- Payment for the $10 dealer tag fee (per tag).
Before the Division of Motor Vehicles can approve your application, your dealership will need to pass an inspection, which we explain below.
This application has a lot of moving parts and can easily become overwhelming—don’t hesitate to call the DMV (302) 744-2571 with any questions you may have.
Business Location Inspection
Your car dealership location must pass an inspection before the Division of Motor Vehicles issues your Delaware dealer license.
During the inspection, a representative will look for dealership requirements including, but not limited to:
- A lot large enough to accommodate a minimum of 5 vehicles.
- A sign showing your business name, measuring at least 24 by 36 inches.
- An office with a:
- Filing cabinet.
- Telephone, specifically for your business.
For more information about dealership inspection requirements, refer to the Dealer Procedures Manual.
Renew Your DE Car Dealer License
Your dealer license will expire on December 31st.
To renew, you need to provide a record of how many vehicles you sold in the previous 12 months, which the DMV uses to determine how many dealer tags to authorize for renewal.
Dealer tags also expire on December 31st, and you can renew them 90 days before their expiration date; however, some established dealers might be eligible for renewals of up to 2 years. There’s a $10 fee for each dealer tag renewal.