Before You Begin
This guide is a general orientation only. It is not legal, financial, tax, or licensing advice. Requirements, fees, and bond amounts are set by the Commonwealth of Virginia and change from time to time.
Always confirm every current requirement directly with the Virginia Motor Vehicle Dealer Board before you spend money or submit anything.
The authority on this process
Virginia Motor Vehicle Dealer Board (MVDB). Phone 804-367-1100. The Board — not the DMV generally — administers dealer licensing, though the DMV administers the dealer-operator test and handles certain other vehicle license types.
The governing law: Code of Virginia, Title 46.2, Chapter 15, including § 46.2-1527.2 on bonding and the Motor Vehicle Transaction Recovery Fund provisions.
Welcome — and congratulations
Opening a dealership is a serious undertaking, and the licensing process is the first real test of it. Virginia has two features worth knowing up front: the pre-licensing education is delivered in person rather than online, and there is a state-administered test you must pass. Both take scheduling, so they belong early in your plan.
Wayne Reaves has worked alongside independent dealers for years. We are not a licensing service and we do not file on your behalf — but we have watched a lot of people go through this, and we know what the road looks like. This guide lays out the shape of it so you know what is coming.
We would like to be the software that runs your dealership — and the smart move is to put us in place before you open, not after. While you work through licensing, we can be getting your system, your website, and your training ready, so opening day is a sale, not a setup project.
The Shape of the Process
Virginia's requirements group into these areas. The education and testing steps have real lead time, so start them while you are still looking at property.
- 01
Choose your license type
the categories differ, and so do the requirements and bond amounts.
- 02
Pre-licensing course and dealer-operator test
in-person course, then a test administered by the DMV.
- 03
Business location
a permanent, enclosed place of business meeting the Board's office, lot, hours, and telephone requirements.
- 04
Business registration
with the Virginia State Corporation Commission if you are an LLC or corporation, plus a federal EIN.
- 05
Garage liability insurance
coverage tied to your dealer plates.
- 06
Surety bond
filed with the Board before an original license is issued.
- 07
Application, fees, and Recovery Fund payment
submitted to the Board.
- 08
Business location inspection
scheduled by the Board before the license is issued.
Step 1
Choosing your license type
Virginia distinguishes among franchise dealers (who hold agreements with manufacturers or distributors), independent dealers (used vehicles), and separate categories covering motorcycles, trailers, travel trailers, motorhomes, and watercraft.
The categories are not all administered the same way. Some vehicle categories are handled by the Motor Vehicle Dealer Board and others by the DMV, and bond amounts differ between them — a motorcycle, trailer, motorhome, or travel trailer dealer may face a different requirement than a motor vehicle dealer, and watercraft is separate again. Confirm which body regulates your intended license type and what it requires before you spend anything.
Step 2
Pre-licensing course and the dealer-operator test
Virginia requires applicants to complete a pre-licensing training course and pass a knowledge test. Unlike many states, the course is delivered in person rather than online, over multiple days, at locations around the Commonwealth — so it requires travel and scheduling.
After the course, you must pass the dealer-operator test, which is administered by the DMV at its service centers.
Book early, and confirm the provider. Course providers, schedules, locations, and registration fees are published by the approved providers and can change — including early-registration pricing. Confirm the current approved providers and fees with the MVDB rather than relying on any figure in a guide, including this one.
Step 3
Your place of business
Virginia sets specific standards for the established place of business. In general terms these cover: compliance with all local zoning requirements; a permanent enclosed structure; a minimum amount of office space; a requirement to be open a minimum number of hours per week with those hours displayed at the main entrance; a lot able to accommodate a minimum number of vehicles; and a telecommunications line with a publicly listed number.
Local zoning is separate from state licensing and is handled by your city or county. Check it before you commit to a property.
Confirm the current dimensions and hours before you sign a lease. Square footage, lot capacity, and the weekly hours minimum are set by the Board and are exactly what an inspector will verify. Discovering that a property cannot be licensed after you have signed is the most expensive mistake available in this process.
Step 4
Business registration and EIN
If your dealership is organized as an LLC or a corporation, you register with the Virginia State Corporation Commission, which will require your federal EIN.
Obtain the EIN free of charge directly from the IRS. Be cautious of third-party sites that charge for this.
Which business structure is right for you is a question for an attorney or CPA, not for a software vendor. It affects your taxes, your personal liability, and how your name must appear on the bond and the application — which must match.
Step 5
Garage liability insurance
Virginia dealers must carry garage liability coverage associated with their dealer plates. The coverage protects against bodily injury and property damage claims arising from business operations.
Tell your agent specifically that the policy is for a Virginia dealer license and plates so the coverage type and limits are written correctly, and confirm the current requirements with the MVDB.
Step 6
Surety bond
Before the Board issues an original license, the applicant must obtain and file a bond with the Board. Virginia law requires the bond to come from a corporate surety licensed in the Commonwealth and approved by the Attorney General — so not every provider qualifies. Ask your agent to confirm eligibility before you pay.
Two things about the Virginia bond that are easy to miss. First, the Board may suspend a dealer's license without a hearing during any period the dealer does not have a sufficient bond on file — and a surety may cancel as to future liability on notice to the Board. Keep the bond continuously in force and treat any cancellation notice as urgent. Second, Virginia's bonding requirement is tied to the Motor Vehicle Transaction Recovery Fund, and the bond obligation applies to newer licensees; dealers may be relieved of it after a period without claims. Confirm how that applies to you with the Board.
Confirm the current required amount and the correct bond form with the MVDB or a licensed surety agent before you buy. Do not rely on a figure from any document, including an older quote.
Choosing a provider
Wayne Reaves does not sell bonds or insurance, does not recommend a particular agent, and receives nothing if you use one provider over another. Your state association, an independent insurance broker, or a licensed surety agent can help you compare. Get more than one quote — pricing varies considerably based on credit and business history.
Step 7
Application, fees, and the Recovery Fund
Application forms are available from the MVDB. Beyond the base application fee, Virginia charges additional amounts that depend on your situation — background checks beyond the first, license endorsements, salesperson licenses, and dealer plates, with a different rate for the first plates than for additional ones.
Newer dealers also pay into the Motor Vehicle Transaction Recovery Fund, a state fund that provides recourse to consumers beyond the dealer's bond. This is a separate payment from the bond premium, and it is a real line item in your startup costs.
Confirm the complete current fee schedule with the Board before you write the check — assembling the wrong amount is a common reason for a returned packet.
Step 8
Inspection and issuance
After the Board reviews your application, it will contact you to schedule an inspection of your business location. The license is issued once the location is verified as meeting requirements.
Do not submit until your location is genuinely ready — signage up, hours posted at the main entrance, phone working and publicly listed, office furnished, lot able to hold the required number of vehicles.
How Wayne Reaves Fits In
We want to be straightforward about what we do and do not do.
What we do not do
We do not file applications, form business entities, sell bonds or insurance, provide legal or tax advice, or interpret state requirements on your behalf. Those belong with the MVDB, your attorney, your CPA, and licensed agents. We receive no compensation or referral fee from bond or insurance providers.
What we do
We build dealer management software and dealer websites for independent dealers — inventory, deal tracking, customer records, reporting, compliance tools, and a website that puts your inventory in front of buyers.
Get set up before you open
The best time to choose your software is now — while you are still getting licensed. Notice how much of this process is really about how your dealership will keep records: titles, deal files, tax paperwork, books kept at your location. That is exactly what Wayne Reaves handles from day one. Dealers who get set up with us during licensing open their doors ready — inventory loaded, forms and deal paperwork in place, recordkeeping organized the way inspectors and auditors expect, and a website already live when the first customer searches for you.
Sign up while your application is in motion and we will have your system configured, your team trained, and your website built by the time the license is issued — so your first sale runs like your hundredth. We have been helping independent dealers open and grow since 1987, and getting started is simple: request a demo or call us, and we will walk you through it.
Where to Get Answers
| Question about… | Ask |
|---|---|
| Licensing requirements, forms, fees, application status | Virginia Motor Vehicle Dealer Board · 804-367-1100 |
| Which body regulates your license type | The MVDB — categories are split between the Board and the DMV |
| The law itself | Code of Virginia, Title 46.2, Chapter 15 |
| Pre-licensing course dates, locations, and fees | The MVDB's current approved course providers |
| The dealer-operator test | Virginia DMV service centers |
| Current bond amount, form, and approved sureties | The MVDB or a licensed surety agent |
| Motor Vehicle Transaction Recovery Fund | The MVDB |
| Business location requirements | The MVDB — before you sign a lease |
| Entity registration | Virginia State Corporation Commission |
| Federal EIN | Directly with the IRS (free) |
| Garage liability insurance | A licensed insurance agent |
| Zoning at a specific address | Your city or county zoning office |
| Federal advertising, Buyers Guide, and financing rules | An attorney or your state association |
| Dealer software and websites | Wayne Reaves Computer Systems Inc. |
Disclaimer
This guide is provided by Wayne Reaves Computer Systems Inc. as a general informational overview only. It is not legal, tax, financial, insurance, or licensing advice, and it does not create any professional or advisory relationship. Licensing requirements are established and administered solely by the Commonwealth of Virginia and are subject to change without notice. Wayne Reaves Computer Systems Inc. makes no representation or warranty as to the accuracy, completeness, or currency of the information here, and accepts no liability for any action taken in reliance on it. Verify all requirements directly with the Virginia Motor Vehicle Dealer Board and consult qualified professionals before acting.
Reviewed July 2026. Reviewed quarterly.