Documentation Fees

raybear

Working with a number of dealers and a number of regions I find doc fees vary from zero to several hundred dollars.

This can make a big difference in a successful negotiation.

So...if you're a consumer, how do you deal with it, and if a dealer, how do you justify it?

rroyce10

..... I have been going down that road for about 2 yrs now, perhaps you will have better luck than I .. that's why I stay out of most of these "discussions" ..l.o.l...

Terry :-)

alfox

paying up to $100 for the documentation fee, as long as it includes the run to the insurance company for the insurance stamp, and the run to the Registry for the registration and title application. That way I can pick up the car without missing work. It's well worth my time, since they are chores I hate. I've never actually paid more than $75 for that service.

I just consider the OTD price including all dealer fees when deciding what to buy.

zueslewis

charge a doc fee plus registration, title and tire tax (a PA thing). In New Jersey, state law allows up to a $199 "doc fee" in addition to all the license and registration fees.

tboner

...they want you to pay the same regardless if they are even going to do the work. Living on the border of MO and IL I've purchased cars in each state. I generally balk at paying a document fee only to be given a title or Certificate of Origin and told to do the paperwork in my home state.

Besides, it is not like someone is going to do just your paperwork when they do run it. Let's say they run to Springfield, IL and back. That's about 180 miles round trip, and let's say it takes the whole day to do the job. So 8 hours at even $10/hour plus $0.35/mile for 180 miles is $63 for mileage. So a dealership might have $143 in transportation and labor costs if you did just one registration.

However, I suspect this is done on a weekly basis, so a store that sells 100 cars a month might do 25 of these a week.

Cost to process your paperwork, $6.00

zueslewis

these doc fees got way out of hand where a good natured dealer charged you $10 (close to the real cost) and another dealer would charge $200 in order to pad profits. In every state I know of, the state mandates caps on these fees.

manamal

Cliffy could correct me, but I belive there is no limit on doc fes in Virginia.

Some dealers charge upwards of $600 for the doc fee. I have not found any dealers that are less than 200

zueslewis

sonjaab

GM dealers all charged 20 bucks DOC fees.
My family has purchased 10 new GMs this year.

blh7068

here in OK charges $10 DOC fee. The Nissan dealer I bought my Maxima from charged $249.

alfox

It's just part of the Out-the-Door price. If the total price is too high, move on to another store.

zueslewis

Contact a dealer or two when you start shopping and ask what their doc fee is - it certainly can vary by dealer.

kinley

raybear

It's not so simple. A dealer advertises a great deal in the paper and sucks people into his store. A certain percentage of them will stick no matter what the doc fee is.

My local Toyota dealer charges $399, one of his competitors charges $139. Guess who advertises cheaper cars?

brianw220

I suppose you also see injustice when electronics retailers, toy stores, etc. advertise low prices on items only to tell you batteries not included when you go to buy one.

audia8q

raybear your post is right on target. The magic of advertising*. haha

*plus, TT&L, doc fee, lot fee, swap fee, storage fee, clean and detail fee, 50 year/5 million miles warranty and deer whistles.

zueslewis

$229 pinstripes. That's $229 a side, by the way.

raybear

Batteries don't cost $260!

tboner

is...

We don't mind paying a doc fee that covers your costs of having the document clerk go to the DMV and register our vehicle. Better him or her stand in line than me.

But be realistic about that fee. Even figuring in the costs of office automation equipment, software and forms, it can't cost anywhere near $299 to get my plates and register my title (unless this $299 includes the fees charged by the state.)

I believe in IL tags are $75/year and title registration is $60. (An insane price to have the state basically record my name, address and DL, mileage at registration, any lienholder info and a VIN.) So 200 beans to cover the state fees and the cost of the documents clerk is probably fair.

However, that same 200 beans above the $135 I have to pay the state makes it worth my while to fill out the forms myself and spend 30 minutes at the Secretary of State branch office.

But I do agree with the notion presented above, I don't care about the doc fee, as long as the OTD price doesn't exceed the pre-negotiated number.

Besides, how much can it really cost in automation equipment if I can renew my tags online and only pay an extra $1.75 to use my credit card instead of driving down to the SoS office. I don't think $1.75 even covers my gas.

TB

brianw220

Be it furniture, electronics, cars, jewelry, etc., advertising is never going to lay the entire transaction on the table. If advertisers laid everything before the consumer, they would become ineffective.

zueslewis

there is a difference between a "doc fee" and "registration fees". Each state usually has standard registration fees - in PA, it's 33.00 for the title, 22.50 for plates, 5.00 tire tax and 12.75 if you have the dealer do the registration on-line. The doc fee is simply a charge that allows the dealer to recoup money and is usually linked to the "pack" - money set aside out of each car deal's profit for administrative costs.

In my opinion, based on my experience, if a dealer charges more than $30-40 for a doc fee, it's just another way to grab profit. There's nothing wrong with profit, but hiding it in an administrative fee that IS NOT A PART OF STATE REGISTRATION AND TAX FEES is just wrong. There's plenty of money to be made in the car business the legitimate way - no sense in scamming folks.

tboner

I think we are saying the same thing. We just used different words.

Obviously yours are more clear to me than mine are to (and probably others)

Cheers,

TB
Autocross This

zueslewis

I have to fight the urge to slalom cones in a construction zone!!

tboner

I did that once at 3:30AM after a service call. The customer has become a friend of mine, so we went to the local Denny's for a bite to eat. We went through a four lane undivided section of road with two lanes blocked off by barrels.

Well, let's just say the Buick with a trunk full of tools and parts doesn't do too bad.

Of course, nothing like my SVT Contour, however.

Didn't pay doc fees on either, BTW.

TB

zueslewis

at Nazareth in E Street Prepared. He's very smooth and very fast.

audia8q

get this...here in CT we have a computer right in our dealership that is connected to the motor vehcile department...we can issue hard plates and do the transfers, name changes, etc... right in the office....but for this privledge we pay the state apx $15K per year in fees, just for this system, and still have to send a runner with the actual paperwork to the Motor vehicle department daily.
Plus...we must charge a $40 emissions fee per car sold for an state emission program that shut down and does not exist...but you get a nice colorful sticker.
talk about a scam!

tboner

Like I've always said, it is sad when the government makes more on a sale than a business with capital at risk.

TB
Pro profit, anti large government, thinks he is a Smart Shopper.

sonjaab

Some of the mega dealers here in NY have
the same deal. Plates and 'puter to print
out reg. and stickers. No running to the
DMV. Iwonder how much it costs them ?
But like I said on all the GM employee deals
on the 10 cars we bought this year 20bucks doc
fees tho...........geo

alfox

I don't care if it's $20 or $200, as long as the bottom line is the right price. Whether the dealer package his profit in the doc fee or on the selling price I could care less. As long as I'm paying market price on the car at the bottom line he can do what he wants.

kkollwitz

was right at the beginning, and he is still right. Pay no attention to any number but the OTD (out the door) price.

cwjacobsen

the basic catch to the doc fee - and why it works as a separate fee - is springing it on the customer after s/he thought they had reached a final price. It's nothing more than one last chance to pad the price at the precise moment the customer has emotionally "bought the car" and has let down his or her negotiating guard.

Even trying to find out what the doc fee is isn't foolproof as I've found that the doc fee that the salesman swears his dealership doesn't have suddenly morphs into an "Administrative Fee" or a "Delivery Fee" when paper signing time comes.

Focusing on OTD and sticking to it is of course the answer. Nonetheless, it is undeniably wearying and irritating to have to fend off such arbitrary fees in order to get to a final price.

CWJ

zueslewis

use the term "drive out", which covers everything it takes to roll the car.

rroyce10

.... I understand that some dealers charge more and some less on this Doc fee issue .. but you gotta understand, it's not free.

Me personally I have a runner, he gets paid $8 dollars an Hr, I also pay the gas, lunch and "depending' on what state, I pay the $6.50 per title flip and the $2.75 per reg.

Depending on how many titles, registration and Surety agreements, this guy will spend 3/4 hrs a day (min), standing in line waiting to drop off or picking-up the titles and regs .. so it's a lot more than that piece of paper that folks get handed at the dealership .. plus depending on the day, I pay someone to log the deals, do the pay-offs, print the deals and notarize all the paper work he gets handed, so add another 3/4 hrs a day there.

Kinda keep in mind, the dealers money is always Upfront, the vehicle, the paper work, the overhead and what most folks forget is - dealers pay All the sales tax upfront on the buyers deal waaay before we get paid ...

So unless someone has an easy $100,000 just sitting around per month, then there has to be some charge to the buyer.

Just my 2 cts ..

Terry.

abtseller

quit trying to add common sense to the equation!



Ed

manamal

I understand doc fees cover some of the overhead expenses; however, should't that be rolled into the cost of the car (i.e., profit?). I know it would not work, because with everyone paying invoice, there is no profit.

I gather that the doc fees are a way of lowering the apparent price the the car. If two dealers sell the same car, one for 18K + 250 doc; the other: 18,250, the first one will adv. 18K + fees; the other would adv. 18250+....

who will get the business?

outhere

dealers feel as if this an avenue for additional profits? If they did just cover expenses of the actual PW...this would not be an issue. Most customers are ready, willing and able to pay a reasonable amount to stay out of the state DMV office. What amount is reasonable? Time=Money

zueslewis

can be an outlet for dealer profit, if the dealer does things that way. Just like $200 pinstripes instead of $19.95 pinstripes. The stripes cost $5 and an $8 an hour guy takes 15 minutes to put them on.

abtseller

the salesman, sales manager, general manager, etc. don't get paid commission on the doc. fee.

Ed

raybear

Maybe not where you work!

brianw220

Why should a dealer just cover his expenses? Many customers don't want the dealer to profit on the sale of the vehicle, the financing, etc. Their attitude is "make it off the next guy." Guess what, you're the next guy. Dealerships are not charities. They are for-profit businesses. Frankly, most are some of the more charitable businesses in the communities in which they operate. They sponsor the little league team, the junior league, 4-H, etc, etc, etc. I can't tell you how many Saturdays I've eaten some lousy rubber chicken dinner because some group solicited the dealership to buy $7 plates for fund raising. The local car dealer is always on the top of the fund-raising list, and they usually pay up. By far, most dealerships are good, ethical businesses whose policies, procedures and profits are scrutinized far beyond anything any other business endures.

abtseller

that is "hands off" money to us lowly non-owners.

of course, this keeps us sniffing to see if the grass is greener on the other side of the block,

Ed

outhere

please re-read my post #35. You have stated the obvious. I asked WHY?...in hopes of a dealer response

tboner

I don't think any of us are saying dealerships shouldn't make money. In fact, I don't believe there is such a thing as excessive profits.

However, there is no way I'm gonna pay $200 just for a dealer to hand me the title or certificate of origin and tell me to visit the DMV, because I buy the car out of state.

The costs and fees, internally to take the car in, such as getting titles for trades and such are legitimate costs of doing business.

But don't tell me that everyone has to pay the $200 (or whatever fee) because it isn't worth it to me.

A fee of say $50 to save me an hours worth of time, I'll pay that, and at least according to Zeuslewis, will probably cover most dealers administrative costs to handle my paper.

But make it optional. If I want to take the title or CoO and do it myself, or I have to do it myself, then I don't want to pay that fee.

TB
Pro Profit, Pro Value.

outhere

I/we have NO problem with profit on a product or a service. Provided it is not excessive. Keep your profit margin where it belongs... on the vehicle. Don't you think the educated shopper shops the doc fee too?

buttle

rroyce10

..... If I had my way, I would let every customer do their own tax, title, regs, pay-offs and all that goes with ..

But unfortunately, this is all based on the state, the county and all that goes with ..

I just had a customer in my office about 8 months ago and he was just DETERMINED to do it all himself, because he knew better.

I explained, he didn't have a dealers license, I explained the title agency wouldn't except his money, I explained they would not except his notary or paperwork, etc, etc. So I said, "knock yourself stupid" -- he did, so after a call from the title clerk and the Sheriffs dept, I went down personally (not my Yob Mon. l.o.l.) and got it all straightened out, between me, their staff, 2hrs, and the kindly Sheriff that was DETERMINED to take him for a little ride.. l.o.l.....

So he finally did get the gist of it .. but still didn't want to pay the $50 - amazing.!

Terry ;-)

tboner

In Illinois, it is pretty easy, two forms. One for the sales tax and one for the title and registration. You simply check on the Title and Registration form what you need, a new title, or a new title and new registration.

You pay your $135 (IIRC) to the Secretary of State and a seperate check to the DoR for the taxes.

You get a cardboard tag (thank goodness, those window stickers are hard to get off when applied to the rear window defogger) until your tags arrive or transfer your existing tags to the new vehicle.

However, sounds like your customer was in a bad state (double entendre intended). If the state requires a citizen to register a vehicle, then they should make it possible for a citizen to register a vehicle.

I didn't say they have to make it easy, but they shouldn't write the laws in such a fashion so that only car dealers or other "agents" are the only ones allowed to register.

Kinda goes against the whole notion that government is working for the people. Of course, I have a problem in many cases with the notion that government is actually working, LOL.

TB

rroyce10

... But in the vast majority of States, if you are buying a vehicle from a dealer or a dealer related business, the dealer HAS to do all the work ... so go figure.

Terry :-(

buttle

The reason car dealers are so scrutinized is that historically they were one of the most unscrupulous and dishonest businesses. But things have changed and, although you still have your share of bad apples, most are decent. You're right UpThere, they are in it to make money and we should let them. But hey, cars and houses are always negotiable and there will always be the debate that they are making too much or the customer won't pay enough. Has anyone ever questioned their doctor or supermarket's prices? I bet not. But we can all be grateful for one thing. and that is that we have a champion in Rayban and the insight he provides. The more educated a consumer, the better he can negotiate. And when he finally does buy that car, he should know that he's gotten a decent price and the dealer has made some money as well. The happy medium. I paid a doc fee of 199 for my car. Didn't fight him over it because I knew that was what I could expect to pay and I had already negotiated a deal that I was happy with.

brianw220

With all due respect, I would submit that several posters have suggested that doc fees should not be a source of profit for the dealership. I think they should. Car dealer profit margins pale in comparison to those made in jewelry and furniture retail for instance, but car dealers are the group whose profits are scrutinized and questioned.

tboner

Never said I was anti-profit. I really think I was pro-profit.

However, I am against having the dealer dictated doc debit being manditory.

Of course, the customer can choose to back out of the deal.

But like, I think I made it clear before, let the buyer decide if the service is worth the price listed.

As you read, in my state, it really is pretty easy to register a vehicle, so 30 minutes of my time on a Wednesday (don't bother going on Tuesday or Saturday) is worth it to save $200. But then I am at work when my pager is on, so I have a little more flexibilty than most.

TB