Documentation Fees

rroyce10

....... What state might that be ..? .. I know of none ..

                     Terry.

driftracer

the licensing and all HAD to be handled by the consumer, but the dealer forwarded the title work to the county for you. No money was charged.

pluto5

Virginia....and anyone can purchase here and get a transportation tag for a few dollars to drive to their home state.......you have to get the manufacturer's certificate of origin, the bill of sale and mileage statement from the dealer to do this. Which they won't give you unless you pay with cash or official bank draft.

rroyce10

.... What state do you live in .. ?

         The reason why I ask, is that I sell to alot of out of state buyers .. they get the 30 day tag, they get the MSO if it's a cash deal (or sent to the lender) and they pay the taxes when they flip the plates and title .. it's that way in 44 states, including Virginia ..

                 Terry.

CarMan@Edmunds

Hi badman1. Your negotiations will go a lot more smoothly if any offer that you make for a new vehicle is an out-the-door price. Make sure that the salesperson who you are dealing with understand that no additional charges, other than tax, are to be added to your offer. If they have a doc fee and refuse to waive it, just have them lower the price of your car by that amount. Let's say that the Edmunds.com True Market Value for the model that you are interested in is $20,000 and you have decided that it is a fair price. Offer the dealership $20,000 total, other than tax for the car or truck. If they have a $400 doc fee that they refuse to waive, tell them that's fine, but to lower the selling price of the car to $19,600 so that its total price is still $20,000.

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pluto5

rroyce10

..... That's what I was trying to ask before .. You CAN'T do your own title work unless you are a out of state buyer, and it's a cash deal .. don't get that Urban Legend started .l.o.l.

                Terry ;-)

badman1

Thanks Car-Man

pluto5

Ycan do your own title work in Virginia--I haven't paid a doc fee in twenty yrs. If you are not paying cash you should put in the purchase order the type of check the dealer will accept--usually a bank draft--otherwise the dealer will be reluctant to release the CO.

CarMan@Edmunds

You're welcome, badman1.

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turboshadow

..... That's what I was trying to ask before .. You CAN'T do your own title work unless you are a out of state buyer, and it's a cash deal .. don't get that Urban Legend started .l.o.l.

                Terry ;-)

--------------------------------------

You can in South Carolina. I've done it in Georgia as well. Its really no biggie, if you don't mind standing in line.

tornado25

I know that the state here has made it clear what the dealer can and cannot charge for DMV-related fees.

In WI, the title fee is, I believe, $29 now (it was incr recently) plus an additional $4 if there is a lien. So far, so good. Seems reasonable. The registration/tags is $45 for a car and for a light truck it varies depending on the GVWR. Sales tax is state tax, plus county tax if there is one--based on the county you live in, not where you buy. 6 SE WI counties have an additional tax used to pay for Miller Park and Brown Co has one to pay for Lambeau Field. No use tax, weight tax, etc. Again, pretty fair. In most dealers, on a new car, the info is electronically sent to the state. The state law sets a reasonable fee the dealer can charge for this service (perhaps $10).

With all of this in mind, any kind of documentation fee is nearly pure profit (which is perfectly fine, since if I am getting my domestic vehicle at invoice, I can't be too upset). However, I think this is what angers most people (and me, too) is that what you are calling a "doc fee" is money you get for doing nothing. There is no "runner", there is no standing in line, none of that. So, the salesperson gladly reduces the price of the vehicle by that amount.

I am happy if I pay what I want for the vehicle, but I think what happens is most people have that niggling feeling that something was "tacked on".

driftracer

don't have doc fees - mainly because the dealer issues the plates on the spot as a licensing agent and charges the normal licensing fees - weird, I guess.

airone

Since shopping for a new 04 Accord Honda dealers have told me that the doc fee is mandated by state law and I must pay it. Is this true? I will be sure to request a lower price if I do have to pay it like you guys explained.

driftracer

but more than likely, it's not "mandated" it's "allowed", with a max amount a dealer can charge.

Easy enough to figure out - call a few dealers and ask the sales guys what their doc fee is (how much).

If the prices differ, then it's not only negotiable, it's not mandatory, either. Ever consider buying in Texas, Arkansas, MO, or CO?

airone

They all keep telling me the doc fee is non negotiable. They are trying to charge $150 for this fee. All prices seem to be the same here. Yea I thought about buying in another state but haven't made up my mind yet.

By the way I just posted a message on the ask a car dealer a question board. Will you go take a look and tell me your thoughts. I would really like to know what you think about it.

Thanks in advance!

rroyce10

... **Turbo .. in Virginia you can have the dealer do it, or you can do it yourself~ (one of the few states) if, your a resident and it's a cash deal .. in S Carolina, the dealer flips the title and does the tag work ...

          The point being here is, I never have been a big believer in the $150/$250/$400 Doc fee's, so with most dealers that is negotiable .. but there is a charge from the state (depending on the state) and there is time, lein charges and dealers pay all the taxes upfront .. so if there is a charge from the dealer for $$'s spent for his runners, paperwork, fee's, time, of let's say $100 or less, than that should be fair depending on the area ...

                      Terry.

93fsu1

Highest I have ever seen, $499 doc fee. See ya.

pluto5

In the Old Dominion there is a special drop off station for car dealers where they leave their requests in bulk and pick them all up when they're processed. Their personnel don't spend even a Virginia minute waiting in line.

mackabee

You are correct. At my store we are hooked up to the DMV computer and all vehicles get registered on the spot. The paperwork still has to be sent to DMV for title issue. Doc fees are not for DMV work. That's a misconception surrounding this issue. I quote right out of the Virginia automobile dealers association brochure "The processing fee is allowed by Virginia law. This fee is similar in many ways to the additional fees charged by many other industries. The processing fee does not compensate dealerships for the cost they incur in doing business. As with most businesses, dealerships frequently provide serves to customers for the benefit of the customer for which they are not compensated in the sale of a vehicle" the list is long so if any of you reside in Virginia, pick up a copy at your local dealer. Some dealers charge excessive fees others do not and some charge none at all.
                    : )
                    Mackabee

pluto5

What kind of services are they talking about? Will they pick up my dry cleaning?

masspector

"As with most businesses, dealerships frequently provide serves to customers for the benefit of the customer for which they are not compensated in the sale of a vehicle"

How ambiguous is that? My dealerships have never done any favors for me that weren't car related. And if they are car related then they are being compensated in the price of the vehicle or the price that I am being charged for the service (ie oil change).

"The processing fee is allowed by Virginia law. This fee is similar in many ways to the additional fees charged by many other industries."

So since everyone else is doing it, we should do it too. Sounds like a wierd way to justify doc fees. Its allowed under state law? I am sure it is allowed to have lots of things, that doesn't mean you have to or should do them.

bobst

Badman, you asked what is a fair doc fee to use when you are calculating an OTD offer. My answer is zero.

If you take the Edmunds TMV that includes transportation, add on sales tax, and then add on a fee for tag/title ($50 here in VA), you should get an OTD price that, in my opinion, has a good chance of being accepted.

Of course, if it gets refused at a couple dealers, you may have to incease it. That's life.

On your written OTD offer, be sure to include that you expect the dealer to do all the DMV work needed to get tags for your new car. That is what we did in October, and they put tags on the new car right at the dealer. I don't know if all states allow dealers to do that, but VA does.

dingo69

Just looked at a certified Lexus yesterday at Hendrick. Was given list price and around 1,500 in taxes and fees...all verbal. Asked for breakdown of taxes and fees: 3% sales tax, blah, blah and like $595.00 for documentation fees.

Am I right in thinking that I should come up with my offer for the vehicle and tell them that offer includes everything but taxes?

Anyone in Charlotte have any experience with doc fees or Hendrick in particular?

raybear

The bottom line is what's most important, consider the doc fee as part of the price.

bobst

No, you are wrong.

You should come up with an offer that includes everything, including taxes. That way, there can be no possible misunderstanding about your exact offer.

If you offer is not accepted, you should walk out. Don't even increase it $10.

That is what we did when we bought our last two cars. We made an offer contingent on us liking the car after a test drive, they did not accept it, we walked out, they changed their mind and accepted it.

Then we took the car for a thorough test drive. It was acceptable to us, so we gave them a check and drove the car home. Yes, car buying is that simple.

bobst

No, you are wrong.

You should come up with an offer that includes everything, including taxes. That way, there can be no possible misunderstanding about your exact offer.

If you offer is not accepted, you should walk out. Don't even increase it $10.

That is what we did when we bought our last two cars. We made an offer contingent on us liking the car after a test drive, they did not accept it, we walked out, they changed their mind and accepted it.

Then we took the car for a thorough test drive. It was acceptable to us, so we gave them a check and drove the car home. Yes, car buying is that simple.

lmp180psu

How did a post at 6:32 come before one a 6:31? Weird.

bobst

You are obviously not familiar with the Theory of Special Relativity, published by A. Einstein in 1914 and verified by countless experiments, including the big 'un on Aug 6, 1945. That theory covers the relative perceived occurrence of simultaneous events. Or sumpthin like that.

lmp180psu

whatever you say.

rroyce10

..... >>That theory covers the relative perceived occurrence of simultaneous events<<..

           Yeah, that's what I was just thinkin' ...

                     Terry ;0)=}*

merrel

OK guys-here's the 'skinny' on doc fees. I'm 65+ have purchased (in my time) 43 automobiles. In the 1960's the dealer prep was nothing more than an exterior car wash. Doc fees are 100% rip offs. The full time title clerk at the dealership is paid an annual salary as is the clean up or detail man that has to make weekly trips to the local DMV with a fist full of car sale paperwork. Their salaries SHOULD rightfully be part of the ultimate sale price of the car. Doc fees are just more icing on the cake. Think about it: (1) there's profit on the car (2) profit on the APR-since the dealer gets back 2-3% of YOUR APR)(3) kick-backs from the manufacturer. The dealer is grabbing it all with both hands. After I get a final price I head for the door-S L O W L Y as I refuse to pay doc fees. It has ALWAYS been taken off. Call their bluff and don't be foolish.

driftracer

with respect to your age and experience, I must address the fact that you've made some blanket type statements that are incorrect:

1) "there's profit on the car"

Usually, but not always, after someone has ground on the entire salesforce for half a day.

2) "profit on the APR-since the dealer gets back 2-3% of YOUR APR"

This is completely incorrect in most cases, and imflammatory at best. Yes, if financed at the dealership, the dealership can mark up your rate. How much, when and why is up to you and your circumstances. You stated this like it always happens, and it certainly doesn't, especially at 2-3 points on every car deal.

3) "kick-backs from the manufacturer"

If you're referring to holdback, forget it. On the few cars that get sold immediately and the full holdback is paid, these proceeds offset the hundreds of dollars paid against a vehicle that sat on the lot for more than 30-45 days. Multiply these amounts by 100-150-200 vehicles on the lot, and those numbers are staggering.

4) "doc fees" are additional charges that the state has allowed all dealers to charge consumers. In most cases, every dealer in a particular state or region will have similar fees. If you don't like those fees, buy out of state.

Finally, doc fees didn't used to exist. The age of the internet and consumer reports has consumers having a hard time swallowing a $100 profit on a $25,000 car. Dealers have to do what they can to keep afloat.

If you owned a dealership, I guarantee you'd do it. You'd charge a doc fee or you'd go out of business.

fastdriver

I just e-mailed the CT State Dept. of Motor Vehhicles that licenses new car dealers in the state of CT and asked them about this DOC stuff! I'll post their response here IF they even answer.

I would be VERY surprised if it is "illegal" to waive it as someone from Crabtree Subaru stated above!

fastdriver

raybear

It's illegal to charge one customer and not another. Also highly unfair. The selling price of the car should reflect the fee amount in order to give the customer a fair price.

fastdriver

raybear-

"Where we are the doc fee must be charged no matter what, it's illegal to waive it. I just adjust my selling price accordingly."

You weren't talking about charging one customer and not another. You said, "the doc fee must be charged no matter what, it's illegal to waive it." That is what I was referring to and that is why I wrote to the DMV because I don't think it's illegal to waive those ridiculous DOC fees. Paperwork and registration is part of your business and should not be PREPRINTED on the sales form with a $$$ amount.

No word yet from the DMV. I'll give them until Wednesday and then I'll call them. I'm sure they won't give me a direct answer anyway because I don't believe there is any law regulating DOC fees!

fastdriver

prodigalsun

If the doc fee is 30 dollars or 300 dollars. that's why you negotiate OTD pricing.

fastdriver

prodigalsun-

It's the principle of the thing! I care. I'm sure it suckers in a LOT of unsuspecting people because it's PRE-PRINTED on the sales form!

I think it's sleazy! Then they wonder WHY they have the reputation that they do! Come down from the mountain and you'll see what its like in the Northeast!

fastdriver

jwm271

I agree!
I think a doc fee of $200.00 to $500.00 is as bogus and in the same category as a second window sticker with $399.00 for fabric protection. In Ky the only actual cost from the Clerk's office is about $6.00 to transfer the title.
  I wonder if people would complain if Kroger tried to charge a cashier fee of $20.00 to ring up your cart of groceries.

fastdriver

jwm271-

EXACTLY! That's what I'm talking about! It should be part of doing business! I don't care what anyone says! It's sleazy!

Besides the fabric protection, you forgot the paint protection! PURE PROFIT and TOTALLY uncalled for.

fastdriver

jratcliffe

Fact: Dealers can ask whatever the heck they want from consumers.
Fact: Consumers are always free to negotiate or walk away.

Frankly, if the dealer is willing to sell me a new, loaded Accord EX-V6 for $1, he's welcome to charge me a $20,000 documentation fee.

There are definitely sleazy dealers and sleazy salesmen in the auto industry, but buyers are adults.

If someone doesn't have the gumption to say "No, I don't want the paint and fabric protection - I understand you've put them on there, so your choice is to give them to me for free, or not sell me the car" then I don't have a lot of sympathy for them.

prodigalsun

I like the mountain, fresher air up here than down there, so I think I'll stay up here, if y ou don't mind Fast.

Fact is, I have yet to see a dealer in the last 15 years of car buying that does not have a doc fee of some kind. It's all about negotation tactics in my mind. They are free to ask for them. you're free to decline to pay them. Because the profit in a new car deal is very thin, on par in percentages with most supermarkets, the dealer will look for ways to maximize money in other areas of the deal, doc fees, F&I, etc. It's up to you to be as prepared as possible for this. I have found that mortgage brokers by your definition are 10 times more sleazy than car dealers, just check out the laundry list of Underwriting fees, loan origination fees, etc.

You just need to negotiate on what you want to pay.

If you don't like it, buy a Saturn.

prophet2

I seriously doubt this statement.

It's about the money. Always has been, always will be.

driftracer

whether that has a positive or negative connotation..

fastdriver

raybear-

Here's the response from the CT DMV regarding DOC fees- "Sorry, however they are not regulated by the state."

Exactly WHO is telling you that it is illegal to "waive" this fee? Your boss? I didn't think there was any such law!

 jratcliffe-

I understand everything you're saying. What I'm saying is that to have mucho $$$$ PREPRINTED on the sales agreement is sleazy. It might lead some people to believe that it is indeed a law and regulated by the state, when in fact it's not- at least here in CT!

prodigalsun-

While the profit may be "thin" on the sales end, they MORE than make up for it in the repair end! Dealers aren't known for making money on new car sales. The chunk of their $$$$$ is from the service departments. As for mortgage brokers being more sleazy, you couldn't prove it by me. I see car dealers much more frequently than I do mortgage brokers. If they had to wait for me, they'd all be broke!

 prophet2-

Sorry to disagree with you, but it is the PRINCIPLE of the thing and not the $$$$! Except for the sleaze factor, there is NO need to add hundreds of $$$ to the sales agreements ahead of time to mislead people into believing that they HAVE to pay this amount because it's already PRINTED on the form.

I'm not saying that I fall for it. I'm more concerned for the less savvy buyers who MIGHT fall for it.

Enough said about this. You won't change my mind and I won't change yours. Buyer beware!

fastdriver

dsattler

I believe the reason dealers who have doc fees refuse to waive them is to avoid any charges of discrimination. Why open yourself up to a lawsuit because you waived the fee for 22% of your white buyers but only 18% of your non-white buyers, or for 22% of your male buyers but only 18% of your female buyers? Inadvertent or not, the dealership is in for expensive trouble. Not waiving the fee for anyone makes life a lot easier for the dealership.

I could be wrong, but that's my guess.

jocko9

sell something that will (hopefully, at least) APPRECIATE in value, i.e. a house. So, theortically when the buyer sells in 10, 15, 20 years he/she receives more than they initially paid. Contrasted with purchasing an automobile (depreciating asset) which if sold 5 or 10 years after the fact garners one 25 cents on the dollar or less.

brianw220

I think you're confusing mortgage brokers with realtors. Realtors sell real estate that will hopefully appreciate. Mortgage brokers sell loans, and I assure you that loans do not appreciate.

jwm271

If you expand your example, it would seem that every dealer that sold the same type of vehicle to various buyers for a wide variety of prices would be just as guilty of discrimination.

driftracer

be it a house or a car, appreciates or depreciates has very little matter on whether the fees charged are above board or not. There's no way we can justify that it's bad for a car dealer to charge a doc fee, but it's OK for a realtor/mortgage broker to nail you with $2,000 worth of useless charges (except for their profit), like $75 for a credit check, when it costs between $1 and $3....

That's a serious pet peeve of mine - everyone always defends realtors, yet slams car dealers, but I've NEVER seen a dealer charge a customer for running a credit check, which is obviously an overhead cost to the dealer.