Salvage Dealer License

Salvage Vehicles

Salvage

  • A salvage motor vehicle has been damaged or is missing a major part causing the cost to repair the vehicle to be higher than the actual cash value of the vehicle before it was damaged. A salvage motor vehicle may be repaired (or “rebuilt”) so that it can be titled as a rebuilt* motor vehicle and registered to operate on public roads. *The blue title issued to a rebuilt vehicle will state on the front of the title that the vehicle has been rebuilt. For more information on title brands, see http://www.txdmv.gov/motorists/buying-or-selling-a-vehicle/title-check-look-before-you-buy, see tab: Title Brands & What They Mean
  • A nonrepairable motor vehicle is a vehicle that has been so badly damaged that its only value is as a source of parts or scrap metal. A nonrepairable motor vehicle cannot be repaired or rebuilt. It will always be branded as “nonrepairable.”
  • Salvage motor vehicles and nonrepairable motor vehicles are issued special titles by TxDMV that are distinguishable from the blue title issued for regular motor vehicles.
  • A salvage or nonrepairable motor vehicle may not be operated on the public roads at any time.

Salvage Dealer

A salvage dealer is engaged in the business of buying, selling, repairing, or rebuilding salvage motor vehicles and nonrepairable motor vehicles.

You must be licensed as a salvage dealer if you:

  • buy or sell more than five salvage or nonrepairable motor vehicles in a calendar year; or
  • rebuild more than five salvage motor vehicles in a calendar year.

You do not need a salvage dealer license if you:

  • buy five or fewer salvage or nonrepairable motor vehicles in a calendar year; or
  • rebuild five or fewer salvage motor vehicles in the same calendar year. *However, you may need a used car dealer (GDN) license if you are engaged in the business of selling these rebuilt vehicles.

Salvage Dealer License Endorsements

While there is only a single salvage dealer license, that license is issued with one or more endorsements depending on the type of business activity. The most common endorsements are:

Used automobile dealer endorsement (2) - This endorsement allows you to buy or sell salvage motor vehicles and nonrepairable motor vehicles that have previously been sold to a customer before being damaged. You may also rebuild no more than 5 salvage motor vehicles in a calendar year if you only have this endorsement. If you wish to rebuild more, then add the Salvage vehicle rebuilder endorsement. You may also sell those rebuilt vehicles if you hold an independent dealer or General Distinguishing Number (GDN) license.

Salvage vehicle pool operator endorsement (4) - This endorsement allows a company to conduct auctions where nonrepairable motor vehicles and salvage motor vehicles are sold.

Salvage vehicle rebuilder endorsement (6) - This endorsement allows you to buy and then rebuild salvage motor vehicles so that the vehicle can be titled and registered to lawfully operate on public roads. In order to sell these vehicles after they have been rebuilt, you must also hold an independent dealer or General Distinguishing Number (GDN) license.

Selling Salvage Motor Vehicles and Nonrepairable Motor Vehicles

If you are selling salvage/nonrepairable motor vehicles without repairing them, then the purchaser submits title paperwork to the county tax office.

Disclosure of Non-repairable Motor Vehicle

Disclosure of Salvage Motor Vehicle

Notice of Non-repairable Titled Motor Vehicle

Notice of Salvage Titled Vehicle

Selling Rebuilt Salvage Motor Vehicles

If you are selling rebuilt motor vehicles, you need a GDN license to properly submit title paperwork to the county tax office on behalf of the purchaser.

For more information on title brands, see tab: Title Brands & What They Mean

Title Brands & What They Mean

Selling Used Automobile Parts

If you are selling used car parts you may need licensing from Texas Department of Licensing and Regulation (TDLR). More information about the Used Automotive Parts Recycler license and TDLR is available by calling: 800-803-9202 (toll-free in Texas) or 512-463-6599 (locally) or visit: http://www.tdlr.texas.gov/parts/apr.htm

Requirements before Applying for a Salvage Dealer License and Endorsements

  • You must have a business location for your salvage operation that is not a residence or apartment complex. Salvage dealers can only operate at their licensed business location.
  • You must have a sign and office at your business location where you will maintain the salvage dealer records.
  • You must comply with all city, county, and state laws. Compliance with city, county, and state laws governing the salvage business is not only a requirement to obtain a license, but compliance with these laws is required to maintain the license. Check with your local government to determine if there are any special restrictions for operating a salvage business in that jurisdiction.
  • You must register for the National Motor Vehicle Title Information System (NMVTIS) program. All salvage dealers are required under federal law to report their vehicle transactions by using NMVTIS. The U.S. Department of Justice is the enforcing agency for the NMVTIS program. TxDMV requires that an applicant provide their NMVTIS number at the time of application and maintain registration during the period of the license. For more information, please refer to the NMVTIS publication, or visit http://www.vehiclehistory.gov/

    NMVTIS Publication

  • You must decide what type of business you will operate and which endorsements you will need to lawfully operate your business. Indicate these on the Salvage Dealer License Application.
  • You must obtain certificates and permits to legally operate in Texas:
  • Assumed Name Certificate: If you plan on using an assumed name, obtain an assumed name certificate from the proper authority, which is the Texas Secretary of State if you are a corporation or from your county clerk if you are a sole proprietor (individual) or partnership.
  • Texas Sales and Use Tax Permit: Photocopy of account status issued by the Texas Comptroller of Public Accounts
  • Certificate of Incorporation, Organization, or Partnership: If you are a Corporation or LLC, attach the Certificate of Filing issued by the Texas Secretary of State (SOS), showing that the entity has been formed and approved. Please do not submit your filing documents. Or if your business was formed in another state, attach the Certificate of Authority issued by the Texas SOS showing that the entity has the right to conduct business in Texas.
  • Franchise Tax Account Status: If you are a Corporation or LLC, provide a photocopy of current account status issued by the Texas Comptroller of Public Accounts.

License Application Fees, Duration & Renewal, and Submission

The initial salvage dealer license fee is $95 for each endorsement.

TxDMV issues salvage dealer licenses for a one year period. A license and the endorsements may be renewed for one year periods. If unexpired, the cost to renew a license is $85 for each endorsement.

Adding an endorsement to an existing license

The new endorsement must expire at the same time as your existing license. Use the table below to calculate the pro-rated fee needed to add the new endorsement.

New Application
Your existing license expires in how many months? Pay this fee to add each endorsement
1 $7.92
2 $15.83
3 $23.75
4 $31.67
5 $39.58
6 $47.50
7 $55.42
8 $63.33
9 $71.25
10 $79.17
11 $87.08

 


More Information

If you need more information about being a salvage dealer, please call us at (888) 368-4689.

If you have questions regarding the titling of salvage vehicles, please call us at (512) 465-5659.

To file a complaint against a salvage dealer or a person operating as a salvage dealer without a license please submit a complaint form found at: http://www.txdmv.gov/contact-us?tab=5

All salvage dealers are required under federal law to report their vehicle transactions by using the National Motor Vehicle Title Information System (NMVTIS). To increase awareness of the program, TxDMV collects the NMVTIS number from all Salvage Applicants. However, the Department of Justice is the enforcing agency for this program. For further information, please refer to the NMVTIS publication , or visit http://www.vehiclehistory.gov/

For questions regarding Used Auto Parts Recycler licensing, please visit the Texas Department of Licensing and Regulation's website or call toll-free (in Texas): (800) 803-9202 or locally: (512) 463-6599.

Introducing eLICENSING

We are excited to announce that the TxDMV eLICENSING system is available as of March 6, 2017. You are now able to access the eLICENSING system by returning to this address, www.TxDMV.gov/eLICENSING. In the event that you received a different URL to access the system, please disregard.

To learn more about eLICENSING, please see our eLICENSING overview page. To receive an email notification when the eLICENSING system is available, please visit www.TxDMV.gov/subscribe and check the box beside the Dealers and Manufacturers subscription topic.

Dealer Tips

This section provides motor vehicle dealers with abbreviated guidelines, observations or considerations to increase the dealer's success in complying with the Texas Rules and Statutes.

Advertising Update

Advertising Seminar

The Do's and Don'ts of Advertising with Coupons

The guidelines below were compiled from over 600 complaints received by TxDMV as well as dialogue with industry organizations.

DO DON'T
Keep in mind that ALL advertisements, regardless of format, must be compliant with TxDMV advertising rules. Advertise "free" items in your coupon if the vehicle can be purchased or leased for a lesser price without the merchnandise or enticement, or if the price of the vehicle has been increased to cover the cost or any part of the cost of the merchandise or enticement.
As a starting point, always ask "Is the advertisement false, deceptive, or misleading?" Advertise a savings claim or discount offer on used motor vehicles with your coupon.
Inform customers on the face of the coupon that any amount listed is only available to be used toward a lease if that is the case. Make guarantees or claims in your coupon that you cannot support with facts and evidence.
Disclose the conditions and requirements necessary for a consumer to receive any advertised cash amount. Use your coupon to advertise a guaranteed amount for a consumer trade-in.
Fully disclose that your coupon only pertains to one specific vehicle by listing a stock number if you only intend to honor the coupon for that one vehicle. Advertise in a misleading or deceptive manner. Consumer protection statutes in every state protect against these types of actions and if you are caught attempting to deceive consumers, the punishment can be more than monetary - your business reputation will also suffer.
Let the consumer know if your coupon only applies toward the purchase of a demonstrator or factory executive/official vehicle. Think you can "write yourself" out of having to comply with the rules by hiding all the important information into a disclaimer at the bottom of the coupon using a small type or font.
Remember that any featured savings claim or discount offer for a new motor vehicle, when advertised, must be the savings claim or discount which is available to any and all members of the buying public. Mislead consumers as to which vehicle or vehicles your coupon applies to by using confusing layouts, headlines, illustrations, or type or font size in your coupon, especially if it is part of a boarded advertisement.

 

New Online System for Motor Vehicle Licensees

eLICENSING LogoMotor vehicle dealers, salvage dealers, and industry licensees operating in Texas may now apply for, renew, or amend motor vehicle licenses online. The Texas Department of Motor Vehicles (TxDMV) replaced its paper-based licensing system with eLICENSING, an online self-service hub for all motor vehicle licensees and salvage dealers operating in Texas. The new system became available in March 2017.

eLICENSING provides many user benefits, including 24-hour access to licensing information, the elimination of paper processing, the ability to submit license applications and payments online, a guided application process facilitating faster approvals, and the ability to track the progress of submitted applications.

To receive email updates regarding eLICENSING, please visit www.TxDMV.gov/subscribe and check the box beside the Dealers and Manufacturers subscription topic.

Licensees must have a current email address on file to use eLICENSING and receive updates on its availability. For more information, email TxDMV at This email address is being protected from spambots. You need JavaScript enabled to view it. or call 1-888-DMV-GOTX (1-888-368-4689).

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