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Comments
Considering what you have said...then why not just change from the term "DOC FEE" to "Additional profit for me after we have already agreed on a price for the vehicle I am selling and you are buying"?
I do agree, though, the dealer today is unfairly scrutinized.
Look, any dealer has legitimate expenses and hopes to make his or her profit objectives. I have no problem with that. But let the price be the price.
I fail to see why any one particular expense should be arbitrarily carved out and surcharged separately from any other. You may as well spring a separate electricity expense fee on the buyer. The coffee on the sales floor and in the service lounge must cost you something. How about prorating that across the number of cars you sell and having a coffee fund surcharge. Why not an office supplies fee?
Electricity, coffee fund, and office supply fees don't exist because if a dealer tried to tack them on at the end of the deal, the customer would be laughing too hard to sign the papers. A documentation fee sounds just official enough (like sales tax) to convince some customers that this is something they can be required to pay in addition to the agreed upon price.
The expenses may be legitimate, but the back-end manner in which - in my experience most - dealers try to recoup them is nothing more than one last chance to try to sweeten the deal.
CWJ
Really, don't you ever read these posts, that tag has nothing to do with the pay-off, the sales tax, the title chase, the title flip - all this stuff is paid UPFRONT by the dealer .. remember the last vehicle you bought ..? That dealer paid all your sales tax upfront and probably wasn't reimbursed for a week or so .. who cares about the temp tag that the state charges me $3.50 for. Then, I have a full time person account for every flippin' one every month
Please Read: I have to pay $8.00 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.
Got it yet ..?
Terry.
: )
Mackabee
The title chase and the payoff however, are only valid if there is a trade in.
So if I walk in, sans trade (little French lingo here, ) and buy the car, then I think it is only fair for the costs of tracking down that car's title to be figured into either
a) My selling price
b) What you offered the "other guy" for taking in his trade.
If you go back to the beginning of this discussion, I did say I'm sure somebody is paying someone $10/hour to track all of these little bits of paper down and put them in the right folders or bureacrats hands.
BTW, on my last car two cars, I had to register them myself. One was a private sale, the other purchased from a dealer in another state.
But please don't get me wrong, I want car dealers to make money. I like cars.
But this has the appearance in many cases of charging the previous owner and the new owner for the same thing.
I know most of the dealers here are pillars of their communities, so of course, don't take anything said here personally.
TB
Wondering if wifey still has French Maid costume from Halloween, LOL
Ed
Yeeeeeaaah, you go boy ...!
But anyway (Slap) .. what were we talking about, oh yeah.!
I charge $99 with a trade and $49 without. Now thats me, I know other dealers charge more and I'm sure some charge less -- by the way, the reason why you did all your own work on the last 2 was .. one was private and the other one was out of state via dealer. Now sometimes I still have to do the work, cuz most states are recriprocol and I still have to pay all the taxes Upfront, then you get a tax paid sheet, then all you do is grab the tag when the 30 day temp starts to run out ..
Did she have a little feather duster .l.o.l..
I didn't say that .. or did I.
Terry.
What's the big shock about this anyway? Are some people really naive enough to believe that they can continue to buy for invoice or less with no attempt by dealers to recoup this? How many people paid doc fees when they bought cars in the 50', 60's, or 70's? Very, very few. Profit margins on cars are at their lowest level ever thanks to many factors including the fact that dealer invoice is now common knowledge for those that care to look for it.
Someone doesn't like a dealer's doc fee? Fine. They're free to buy from whoever they like. But to whine about it like it's a total affront to commerce is ridiculous.
Do you really care if the DOC fee is $5 or $5000 if the bottom line is the lowest??
If the customer failed to ask for an out-the-door price, including all dealer fees, it's the customer's fault. He/she needs to deal with his/her own failure and not blame the dealer.
If the customer DID ask for an out-the-door price including all dealer fees, and the salesperson failed to disclose the doc fee at that time, it's the sales-person's fault and the customer should consider not rewarding such behavior with a sale.
See - it's simple! Therefore I conclude that much of the angst in this topic must be generated from some other agenda, such as begrudging the dealer his profit....
NO! say it ain't so!!!
-Chris
Why not just charge what the documents cost to process and raise the price of the car $200? Obviously, if a state like NY has a limit on these fees there must have been at least a perceived sham going on!
There is no shortage of advice on car-buying that tell you about doc fees, ad fees, ADP (or whatever you want to call it), Mop & Glow, etc. Any buyer today who goes in talking just the purchase price for a car, ignoring all the extras that can be added, and then declares it a "scam" when the dealer tries to add to the sale, is trying to cover his own failing with anger at the dealer.
There are lots of benefits to playing a victim.
Rich
"How much can I buy the car for?"
"How much will you give me for my trade?"
"What's my interest rate and term?"
The, when the buyer, who has failed to ask any further questions walks into F&I to sign up and finds another $200 in fees, sometimes they have a whole litter of kittens on the spot.
While I don't like dealerships that charge exhorbitant fees "just because", like charging a $250 doc fee when the Mom and Pop store down the street only charges $49; I dislike, even more, consumers with chips on their shoulders, feeling more educated than and superior to anyone in the dealership, who weren't educated or superior enough to ask a simple question - "What's your doc fee and how much are title and reg fees?"
Guess what? The salesman assumed you were smart enough to ask a question that you needed an answer to and because of that, you shouldn't whine about it later.
It's easy for me to believe that when it comes to trying to think of non-TTL "add ons" that might possibly be added to a sale, someone who sells cars for a living will be able to think rings around a customer who buys cars only once every few years. What I can't understand is why some sales people express such contempt toward customers who are taken aback by this tactic.
Financial specialists are used in this instance as they are also the people who interview you concerning senstitive credit issues you may need to work through to retain financing.
Just like getting hit up for Scotchguard when you buy a new couch or the electronics warranty when you buy a new computer, the business (read: dealership) has the right to offer these services and you have the right to say "no".
One final point, sort of a question. If you went to Pep Boys to buy a new battery for your car and the person there didn't offer you new battery cables (always a good idea every 3-4 years) or a battery terminal cleaner, wouldn't you be pissed when you got home and found you needed these items? Not the same story, but it's the same concept.
If you asked for a round number on just buying the car, that's another story.
On all three, my object was to negotiate a final price in dollars. In only one case was the price we negotiated the price we were expected to pay. In the other two, the dealerships tried to hit us with fees after we thought we had settled on price and negotiation was over. In one, the salesman and his manager had "forgot" to include the "administration fee." I'll repeat that. Both of them wanted us to believe that they had forgot about their own fee. The third dealership added a "delivery fee." Their explanation for its 11th hour inclusion being that I had asked about "administration," "advertising," and "documentation fees," but not "delivery fees."
Terry can lecture me all he wants on how much he pays his "runner." He also pays his utilities, lot boys, mechanics, accountants, cashiers, secretaries, local advertising, perhaps a mortgage, and goodness knows what all else. His, like any other dealer's, expenses are real. No doubt about it. Covering your costs and making a profit are what setting (or negotiating) a price is all about. And the price should be the price, not price plus certain expenses (but not others) arbitrarily selected by the dealer to somehow be outside the negotiated price.
Landru, I appreciated your post above acknowledging that these "fees" came into existence relatively recently primarily as a counter to the "invoice buyer." (Funny how dealers could pay their runners to spend all day in the DMV without them before. They must have been losing their shirts without even knowing it.) As Craig has repeatedly pointed out, you offer the public something long enough, say rebates, 0% financing, or cars at invoice, and the market comes to expect these thing as standard practice rather than extraordinary so I'm not surprised that these extra "fees" have arisen in an effort to make back what had been given up.
But as long as dealership personnel can conveniently "forget" these fees, or withhold their existence because the buyer did not use the exact same title for them that they use, please forgive me for calling the whole process of having to fight through to the final number "wearying," and not a little bit pathetic.
CWJ
All in all I don't care how they package their price - hell, they can break out their phone and electric bills and itemize them on the Billof Sale if they want, just be up front about it.
Dollars are dollars. Let's get to the price and I'll pay it. That's why I describe the whole hide the fee game as wearying and pathetic rather than angering and dishonest.
CWJ
I never lectured you about anything .. l.o.l.. it's the cost of doing business .!
Did you ever look at your closing costs on your last mortgage .?
Title search $498, it costs less than $50, credit check $70, it costs $4, appraisal $450, it cost less than $100, DOC FEE's $250/$500+ depending on were you live, costs less than $60, administration fee $300, don't cost much more than $75, add a point or 2, which happens to be the banks profit -upfront- then, add a little PMI at a 71% profit margin, etc, etc, etc, etc.
Most folks I know, drop $5,000/$6,000 in a closing on a $180/$200,000 home, it doesn't cost much more than $2,000 -but- that's ok .? .. and you are beating me up for $99 bucks, I bet you have your first communion money ..l.o.l..
Terry :-))
Mack jr. grabbed the phone, called Toyota dealer and spoke to sales lady. "I'm looking for a 92 Camry DX, with the following options: xx,yy,zz. Do you have one in stock?" Saleslady : "Yes we do. What color would you like.?" Mack Jr. "Either the Almond Beige or the Wineberry pearl. I haven't decided yet. What would be the total price including tax, title, license and processing fee." Saleslady "Price of the car is $xxxx, tax, xxx, title, xxx, license, xxx, and processing fee xxx." Mack Jr. "What's your name again?" Sales lady "Laura" . Mack jr. "Thank you Laura. I will be getting back to you later." 5pm that evening Mom and Dad are exhausted, have jumped through hoops to get a decent price at three dealers with no success. Mack calls Mack Jr. to check up on the kids. Mack Jr. "Dad, I called this lady at xyx Toyota, her name is Laura and she will sell you the car for xxxx out the door!" Mack: "Really!" Mack Jr. "I wrote it all down in one of your notepads. I'll show it to you when you get home." Mack: "Ok, we'll be there shortly." Mom and Dad get home Mack Jr. and the two younger Macks are hungry and ready for dinner. Mom starts cooking dinner, Mack Jr. hands notepad to Mack Sr. Mack Sr. gets on the phone to xyx Toyota and asks for Laura. "Hi Laura, this is Mackabee, my son talked to you earlier about a 92 Camry. I was calling to verify the figures you gave him." (Mack reads figures back to Laura) Laura : "That's correct sir." Mack "In that case we will be over right after we eat, about 7:30 ok?" Laura "That's fine, what color did you want?" Mackabee looks at Mrs. M. and asks "Ok, what color do you want?" Mrs. M says "We already have a beige car, pick the color." Mack to Laura "Ok, we'll go with the wineberry. See you at 7:30."
People in the car business keep blaming the customers for the cut throat attitude, but if someone cuts your margin to the bone and some other dealer sells him a car for that price, who's to blame??? In many cases your fellow dealers are your worst enemy.
It seems that this is one of those areas where very many on both sides will blame the other side for all the problems in the process. I think, however, the car dealer body is the one who sets the tone for the process and as long as you have so many con artists selling cars, the "good guys" in the business will be hard pressed to change the situation.
Too many forgotten fees, double billed items, and just out and out lies happen daily and the average consumers, who are nowhere near as savy as some of you think, continue to look at the car buying process as a scary thing.
Most of our big ticket purchases today make the consumer feel like he's running through a mine field, its just that the price you pay for a car is a lot more than most refrigerators or TVs. Not any harder perhaps but just more costly.
You know the old saying...fool me once, shame on you...fool me twice, shame on me. Many people have been burned buying a car and that causes them to appraoch the deal with a very wary attitude. I'm sorry but adding an exorbitant doc fee or changing you shippings twice (one guy tried to do that to me a couple of years ago)just makes you feel like you've been screwed!
Is it all a problem on the consumer's end that car saleman are listed as some of the least trusted people in the country?? Don;t blame the consumer...police your peers!
: )
Mackabee
p.s. after driving the 03 4runner I'm getting the bug though.
Doc fees, that's a great argument for anyone. I was looking at a lemon law case from New Jersey tonight where there was a $443.75 doc fee.
Where the heck do you get $443.75?? Then I did the math. It was .025 of the purchase price, tax not included ($17,750). I laughed out loud - since when does it cost more to title and tag a car that costs $25,000 than one that costs $15,000 - the only difference in that state is the sales tax!! That, my friends, is a rip off and about $400 of undeserved profit.
Do any of the other jurisdictions charge a VAT (value added tax)?
I feel you are working with a chip on your shoulder .. What most folks kinda forget is, profit is not a 4 letter word. But it's ok for the furniture store to make $700 on that couch you are sitting on, it's ok for them to make $250 on that chair, $500 on the dining room set, etc, etc.
Just because folks know the cost of something, doesn't give them the right to buy it for that .. if you ever knew the cost for your attorneys time, would you ever pay him.? especially when you see the guy just made $900 of pure profit, for less than 2hrs in the court room .. you keep referring too being screwed, what does that mean .? Does that mean that a dealer made $5/$7/$900 on a investment of $20 grand, does that mean you should be able to calculate what you feel is Fair .? If so, it comes down too - buy, no buy or goodbye ..!
I'm not trying to be smart here, but all this "new" info, gives some folks the concept of "guess what, I know what you paid for this, so here's your $50 bucks" .. it just doesn't work that way in business. I know the cost of furniture, but I can't give them a $50 profit, I know the cost of boats, but I can't give them a $50 profit .. that dog just won't hunt. So I discuss it , I negotiate it and when we reach a figure that, the particular dealer and I agree on, then we shake hands and do business - or we don't .. it's easy. I don't feel I was being ripped off .. I might feel that his overhead might be too high or he has too many Ex wife's or whatever - and I go on. l.o.l..
Unlike most markets, there is a bunch of variables that go on 24/7-365. Most folks owe $12,000 on $9,000 vehicles ..or.. they owe $32,000 on a $19,000 vehicle, so pick your poison, it's still the same $$. The vast majority of this has nothing to do with the dealer, it has to do with the consumer. They will put little or No money down, they move themselves up to a $30,000 vehicle, when they should be looking at a $20,000 vehicle and this my friend goes on 24/7, and the Dealer get's the blame for a decision that was made by a 35 year old branch Mgr, with a Masters degree and living in a $400,000 home .. the dealer made me do it.! Stop.!
On many occasions, I will bring a customer into my office and hear "that last dealer screwed me" - I look at their paperwork, I see that the dealer made $2/$300 and put too much into a garbage trade and the buyer is trying to trade now after 20 months, and has All of $500 for a downpayment -- gheez who's blaming who for what ..?
Is there some Bad guys out there .. sure.! But sometimes, the biggest Bad Guy out there is yourself ...
Terry :-)
TB
Lives in a $75K house and drives a $1K car everyday. Saves a fair amount of jack too.
All the information is out there to research any aspect of a car deal. In nearly every other retail transaction, consumers don't have that access. Car business folks get hacked on because consumer feels armed.
On the other side of that coin, consumers walk into furniture stores, electronics store and clothing stores like cattle heading to slaughter. No sympathy here.
I don't deny you the need make a profit and honestly don't really care what that profit is. Never said you should make $50 or $1,500 per car and in fact have really no idea how much you make. I know that there are consumers out there who beet the last penny out of every deal, then they spread the word via web sites like this and the next thing you know thousands of consumers who already distrust the dealer think they are getting screwed again. However, someone had to sell the guy who squeezes the last penny out of a deal that car. If one of your own did not give in to his tactics then he could offer as little as he wanted but would go no where if no one took the offer.
Look, I have a great local Ford dealer who I have bought 3 cars from in the last two years. I go in and he knows that I have researched the car, options and prices. He asks me what I show as the invoice on the car I want and if his figures agree, then he gives me a figure (say $200 over that invoice price)and we agree and do the deal. Painless, nice and very friendly. Is he screwing me??? Don;t know and don;t care, but he treats me well and I send friends to him to buy Fords too! Also get treated well in the service dept so its a very nice arrangement.
I go back to my basic premise thou which is that when a dealer charges $300 to $400 for Doc Fees most people will see that as a tactic to either (1) cloud the transaction process or (2)screw the customer. I suggest the place to make a profit is in the price of the car not in a fee like that. Again, would states like NY put a limit on this fee if there had not been abuses???
No my friend, I think that a lot of times you folks in the car business are the ones with a chip on your shoulder. Don't paint all of us consumers with the same brush and don't burry your head in the sand regarding the sleazy tactics some car dealers use...and if you are a honest guy, don't crawl into bed with the sleazes by defending them.
If it costs you $100 to get my title and reg and everything else, don't charge me $400 "because you can."