DMV Dealer Pre-License Training UPDATED ACTUAL QUESTIONS AND
CORRECT ANSWERS
ANY of the following actions could result in a Dealer - Misuse of Special (Dealer) Plates
license suspension: - Bait & Switch advertising schemes
- Failure to pay Administrative Service Fees when due
- Submission of dishonored check to Department
- Selling at unlicensed locations
- Failure to transfer title
- Paying "Bird Dog" fees
The Guide must be in plain view (with both sides visible) - Hung from the rear-view mirror or outside side-view mirror
and may be either: - Placed under a windshield wiper.
- Attached to a side window
A Guide in a glove compartment, trunk or under the seat is not conspicuous
because it is not in plain sight.
What can the DMV, as well as State and Federal The DMV, as well as State and Federal regulatory agencies, can limit, suspend, or
regulatory agencies do? revoke a Dealer's license and or impose penalties should they fail to abide by the
laws and regulations governing Dealers.
All Dealers must have a Surety Bond valued on their - OL 25 New or Used Auto-Commercial Dealer ($50,000)
license type and provide proof: - OL 25B Motorcycle Dealer, Motorcycle Lessor-Retailer, All-Terrain Vehicle
Dealer, or Wholesale-Only Dealer (Less Than 25 Vehicles Per Year) $10,000
, Never advertise or sell as used car as "Certified" when - Odometer does not indicate the actual mileage of the vehicle.
the: - Vehicle was reacquired by the manufacturer or dealer under state or federal
warranty law (i.e. "lemon law").
- Vehicle was damaged by a collision, fire, or flood unless repaired to safe
operational condition prior to sale
- Title was branded as a lemon law buyback, manufacturer repurchase, salvage,
junk, non-repairable, or similar designation
- Vehicle has frame damage or was sold "as is"
If the odometer cannot register the same mileage as it must be adjusted to read "0" with a notice attached to the vehicle's left door
before the repair: frame (specifying the prior mileage and the date on which it was serviced,
repaired, or replaced) by the person performing the service or repair
Dealers must securely store their Reports of Sale at their and are required to "implement federal safeguard standards for storage" and
principal place of business for maintain the records vehicle transaction for 90 days (was 18 months) at the
principal place of business or branch location.
After 3 months (90 days), use an offsite storage facility within the state or third-
party vendor to maintain records for a total storage requirement of 36 months / 3
years.
- Digital storage is acceptable after the initial 90 days
- DMV requested records must be provided within 3 business days
California's "Car Buyer Bill of Rights" (AB 68) limits a - 2.5% for terms up to 60 months
Dealer's compensation from an institution financing the - 2.0% for terms of 60 months or longer
purchase of a vehicle is limited to no more than:
This limitation does not apply when the assignment requires the Dealer to bear
the entire risk of financial performance for the consumer or when the assignment
is more than six months after the date of the Conditional Sale Contract.
When a Dealer sells a Lemon Law buyback vehicle, they - The year, make, model, and vehicle identification number
must notify the buyer on letter-size paper of the - That the vehicle title is marked "Lemon Law Buyback"
following: - The nature of each nonconformity reported by the vehicle's original buyer or
lessee
- Any repairs made to the vehicle in an attempt to correct each nonconformity
Dealers should complete and submit the following to - Renewal Application (DMV form OL 45)
renew their license: - Proof of Continuing Education (every two years)
- Proof of Surety Bond
- Payment of Renewal Fees
Who may operate a vehicle with special plates for any (a) A sole owner, a general partner, a manager of a limited liability company, or a
purpose? corporate officer or director of a Dealer provided that individual is actively
engaged in the management and control of the Dealer's business operations
(b) A general manager, or business manager, or sales manager who is actively
engaged in the management and control of the business operations of the Dealer
when no other individual meets the criteria in (a) above
(c) A driver -if- an individual identified in section (b) is also in the vehicle.
(d) An unaccompanied adult who regularly resides in the household of individuals
identified in section (b) to pick up or drop off that individual.
CORRECT ANSWERS
ANY of the following actions could result in a Dealer - Misuse of Special (Dealer) Plates
license suspension: - Bait & Switch advertising schemes
- Failure to pay Administrative Service Fees when due
- Submission of dishonored check to Department
- Selling at unlicensed locations
- Failure to transfer title
- Paying "Bird Dog" fees
The Guide must be in plain view (with both sides visible) - Hung from the rear-view mirror or outside side-view mirror
and may be either: - Placed under a windshield wiper.
- Attached to a side window
A Guide in a glove compartment, trunk or under the seat is not conspicuous
because it is not in plain sight.
What can the DMV, as well as State and Federal The DMV, as well as State and Federal regulatory agencies, can limit, suspend, or
regulatory agencies do? revoke a Dealer's license and or impose penalties should they fail to abide by the
laws and regulations governing Dealers.
All Dealers must have a Surety Bond valued on their - OL 25 New or Used Auto-Commercial Dealer ($50,000)
license type and provide proof: - OL 25B Motorcycle Dealer, Motorcycle Lessor-Retailer, All-Terrain Vehicle
Dealer, or Wholesale-Only Dealer (Less Than 25 Vehicles Per Year) $10,000
, Never advertise or sell as used car as "Certified" when - Odometer does not indicate the actual mileage of the vehicle.
the: - Vehicle was reacquired by the manufacturer or dealer under state or federal
warranty law (i.e. "lemon law").
- Vehicle was damaged by a collision, fire, or flood unless repaired to safe
operational condition prior to sale
- Title was branded as a lemon law buyback, manufacturer repurchase, salvage,
junk, non-repairable, or similar designation
- Vehicle has frame damage or was sold "as is"
If the odometer cannot register the same mileage as it must be adjusted to read "0" with a notice attached to the vehicle's left door
before the repair: frame (specifying the prior mileage and the date on which it was serviced,
repaired, or replaced) by the person performing the service or repair
Dealers must securely store their Reports of Sale at their and are required to "implement federal safeguard standards for storage" and
principal place of business for maintain the records vehicle transaction for 90 days (was 18 months) at the
principal place of business or branch location.
After 3 months (90 days), use an offsite storage facility within the state or third-
party vendor to maintain records for a total storage requirement of 36 months / 3
years.
- Digital storage is acceptable after the initial 90 days
- DMV requested records must be provided within 3 business days
California's "Car Buyer Bill of Rights" (AB 68) limits a - 2.5% for terms up to 60 months
Dealer's compensation from an institution financing the - 2.0% for terms of 60 months or longer
purchase of a vehicle is limited to no more than:
This limitation does not apply when the assignment requires the Dealer to bear
the entire risk of financial performance for the consumer or when the assignment
is more than six months after the date of the Conditional Sale Contract.
When a Dealer sells a Lemon Law buyback vehicle, they - The year, make, model, and vehicle identification number
must notify the buyer on letter-size paper of the - That the vehicle title is marked "Lemon Law Buyback"
following: - The nature of each nonconformity reported by the vehicle's original buyer or
lessee
- Any repairs made to the vehicle in an attempt to correct each nonconformity
Dealers should complete and submit the following to - Renewal Application (DMV form OL 45)
renew their license: - Proof of Continuing Education (every two years)
- Proof of Surety Bond
- Payment of Renewal Fees
Who may operate a vehicle with special plates for any (a) A sole owner, a general partner, a manager of a limited liability company, or a
purpose? corporate officer or director of a Dealer provided that individual is actively
engaged in the management and control of the Dealer's business operations
(b) A general manager, or business manager, or sales manager who is actively
engaged in the management and control of the business operations of the Dealer
when no other individual meets the criteria in (a) above
(c) A driver -if- an individual identified in section (b) is also in the vehicle.
(d) An unaccompanied adult who regularly resides in the household of individuals
identified in section (b) to pick up or drop off that individual.
