Colorado Dealer License Guide

Click on Each Step Below for More Info

The state has set a few qualifications that you must meet in order to get a Colorado auto dealer license:

You don't need $100k cash in the bank to get a Colorado auto dealer license, but you do need a net worth of at least $100,000. Add up all of your assets (home, cars, bank accounts, investments, personal belongings, etc) and subtract all of your debts (mortage, car loan, credit card debt, etc). As long as that equals at least $100k, you qualify for a Colorado auto dealer license!

The Dealer Board will obtain a Vantage credit report from Experian. A minimum score of 701 is required in order to get a Colorado dealer license.

Every applicant for a Colorado motor vehicle dealer license will need to pass a background check. If you have ever been convicted of (or pled no contest to) any felony or misdemeanor crime, you will need to include all supporting court documents with your application. Additionally, you must be in compliance with any Child Support Orders, otherwise there may be a hold on your application and a delay in processing.

If you haven't had a valid Colorado dealer license within the past three years, you will need to take a pre-licensing education course. At the end of the course, you'll be provided with a certificate of completion, which you'll need to include with your Colorado motor vehicle dealer license application. More info and the list of approved course providers can be found here.

After taking the pre-licensing education course, you will then need to take and pass the Mastery Exam. Once you pass, you'll need to fill out the Mastery Exam Affidavit (DR 2097). You can get more information about the Mastery Exam here.

Now it's time to find a location for your dealership. Be sure the location meets all of the state requirements for a dealership location in Colorado. Also, be sure the location has the proper zoning for a dealership.

Once you've obtained your location, you'll need to post your hours of operation. You must be open at least 3 days per week for a continuous 4 hours per day between 8 AM and 9 PM. You also must install a permanent sign that identifies your dealership by its licensed name and is clearly visible to the public. If you don't yet have a permanent sign installed when you submit your Colorado dealer license application, you can use a temporary sign as long as you have a permanent sign ordered.

Get a copy of our free Colorado dealer license application checklist.

This is a crucial step in the process. There are many documents that you'll need to submit, and you want to make sure everything is filled out correctly so you don't run into unnecessary delays in processing your application for a Colorado auto dealer license. Here are the documents you will need:

  • Pre-Licensing Education Certificate (required if you haven't held a Colorado motor vehicle dealer license in the past 3 years.
  • Mastery Examination Affidavit (DR 2097) (required if you haven't held a Colorado dealer license in the past year.
  • Addendum (DR 2109B) for each owner, partner, LLC/LLP member, stockholder (5% or more), director or officer.
  • Copy of a photo ID for the applicant and all people who filled out an Addendum (DR 2109B).
  • Affidavit - Restriction on Public Benefits (DR 4679) for the applicant and all people who filled out an Addendum (DR 2109B).
  • Statement of Financial Condition (DR 2114) for each owner, member, or partner. If filing as a corporation or LLC, a financial statement is also required.
  • Place of Business Affidavit (DR 2044) and photos of your dealership’s signs, entrances, buildings, and bathrooms to avoid a potential delay in processing.
  • A copy of the lease for your place of business (if applicable).
  • Dealer Plate Affidavit (DR 2640).
  • A written Business Plan including but not limited to: staffing, hours of operation, overhead costs, sales projections, inventory acquisition, Floor-planning / financing / lines of credit.
  • Franchise agreement (if applying as a franchised dealer).

    • If applying as an LLC/LLP/Corporation, you will also need the following:

  • Certificate of Good Standing from the Colorado Secretary of State.
  • Constituent Filed Document (such as Articles of Organization, Articles of Incorporation, Articles of Assocation, Certificate of Limited Partnership, etc).
  • Bylaws of the Corporation, operating agreement for a limited liability company, or the partnership agreement for any partnership.
  • Trade Name — If doing business in a name other than the corporate name, attach a copy of the Certificate of Assumed or Trade Name.

You will need to purchase a $50,000 Colorado auto dealer bond as well as Colorado auto dealer insurance. Click the following links for the best rates for your Colorado dealer bond as well as the best rates for your Colorado dealer insurance.

When you apply for a Colorado dealer bond, the price is based on credit score. The higher your credit score, the lower the cost for your Colorado dealer bond. Be sure to get your bond from an independent insurance agency that can shop multiple carriers for you. Colorado Dealer Insurance is a great option.

The sooner you acquire your Colorado auto dealer insurance, the sooner you are protected when you buy inventory and have customers to your lot. Dealer insurance is unique and unlike other business insurance, so you want to be sure you are getting your insurance from an independent agency with experts that specialize in insurance for Colorado auto dealers. Colorado Dealer Insurance is a great option.

It's finally time to submit your application for a Colorado dealer license! Be sure to include payment for the required fee - the current fee is $623 plus a background check fee of $39.50 per applicant. Check this page for a list of all fees.

Once you have all of your documentation in order, you can apply for a Colorado auto dealer license online. If you prefer the old school way, you can fill out the Dealer License Application (DR 2109) and mail it in.