Secondhand Dealer and Pawnbroker License

If you start a business selling or trading secondhand (used) items, you may need a secondhand dealer–pawnbroker license to operate. You’ll also need a secondhand dealer license if you sell new items but also buy and sell secondhand items of the same type or class as the new items you sell. Additionally, if you sell items at a flea market or other temporary location.

If you’re not sure if you qualify for a pawnbroker license, ask your business licensing agency to clarify.

Applying for Your Pawn Shop License

Before you start buying or selling used or secondhand items, you must apply for your pawnbroker license. Start by contacting your city’s business licenses, permits & tax division to get a pawnbroker license or secondhand dealer license. The requirements for the business license may vary from state to state, but you will most likely need to include the following in your application:

• Secondhand dealer or pawnbroker license application
• Background check or fingerprint
• Surety bond (for pawnbrokers only)
• Pawnshop license application fee

Your state will have a required minimum for the surety bond as part of your secondhand dealer license application.

Other Considerations for Your Pawnbroker License

As a business owner, you may also be required to apply for other business licenses, certificates of authority, or sales tax registration before you can start selling and buying items.

Also, keep up with your renewal fees so that your pawnbroker license is always up-to-date. Not having your license updated puts you at risk of being fined or even shut down, so mark your calendar so that you’re always compliant.