DMV Dealer-Specific Regulations 2 — Questions and Answers
Question 1: A dealer must display the Buyers Guide on a used vehicle in which location?
- On the side window or windshield (Correct answer)
- In the glove compartment
- Attached to the steering wheel
- Hung from the rearview mirror
Correct answer: On the side window or windshield
Federal law requires the FTC Buyers Guide to be displayed prominently on the side window or windshield of each used vehicle offered for sale.
Question 2: Which document must a dealer provide to the buyer at the time of a used vehicle sale that discloses warranty coverage?
- Buyers Guide (Monroney sticker)
- Buyers Guide (FTC sticker) (Correct answer)
- Certificate of Title
- Odometer Disclosure Statement
Correct answer: Buyers Guide (FTC sticker)
The FTC Buyers Guide is the required document disclosing whether the vehicle is sold 'As Is' or with a warranty.
Question 3: A dealer who sells a vehicle 'As Is' is legally stating that:
- The vehicle has passed a state safety inspection
- The buyer assumes all repair costs after the sale (Correct answer)
- The dealer will cover powertrain repairs for 30 days
- The vehicle has a clean title history
Correct answer: The buyer assumes all repair costs after the sale
An 'As Is' sale means the buyer accepts the vehicle in its current condition and the dealer bears no responsibility for repairs after the sale.
Question 4: Under most state DMV regulations, a dealer's license must be renewed:
- Every 6 months
- Annually or biennially as required by the state (Correct answer)
- Once every 5 years
- Only when there is a change of ownership
Correct answer: Annually or biennially as required by the state
Most states require dealer licenses to be renewed annually or biennially, with the exact schedule varying by state.
Question 5: What is the minimum display area (lot) requirement typically imposed on licensed motor vehicle dealers?
- No lot is required for online-only dealers in most states (Correct answer)
- A minimum of 5,000 square feet in all states
- An enclosed showroom with at least 10 vehicles
- A minimum of one acre of paved surface
Correct answer: No lot is required for online-only dealers in most states
Many states allow online or wholesale dealers to operate without a physical display lot, though requirements vary significantly by state.
Question 6: A dealer who sells more than a state's annual private-seller vehicle threshold (e.g., 4–6 cars) without a license is subject to:
- A verbal warning only
- Civil fines and potential criminal prosecution (Correct answer)
- Mandatory purchase of a temporary permit
- An automatic 90-day suspension
Correct answer: Civil fines and potential criminal prosecution
Selling vehicles above the private-seller threshold without a dealer license violates state law and can result in civil fines and criminal charges.
Question 7: Which of the following is a dealer typically required to maintain for DMV audit purposes?
- A record of every test drive taken
- A deal jacket containing all transaction documents for each vehicle sale (Correct answer)
- Monthly customer satisfaction surveys
- A video recording of every sale closing
Correct answer: A deal jacket containing all transaction documents for each vehicle sale
Dealers must maintain a deal jacket for each transaction, which includes the title, odometer disclosure, purchase agreement, and other required documents.
DMV Dealer-Specific Regulations 2
A dealer must display the Buyers Guide on a used vehicle in which location?