What Are Dealer Processing Fees?

Should I pay dealer doc fees?

Documentation fee: Dealerships charge car buyers a documentation fee, or “doc fee,” to cover the cost of preparing and filing the sales contract and other paperwork.

In some states, the doc fee is limited by state law.

Dealerships may sell a vehicle at an attractive price but then add a high doc fee to the contract..

What is a reasonable dealer documentation fee?

DOC charge: $325 to $1,093 Usually referred to as a “documentation fee” by salespeople, this is a general charge for dealer overhead and is the one most likely appear during negotiations.

What dealer fees should you pay when buying a used car?

Many dealerships will roll sales tax into the title and registration fees we discussed earlier into one TT&L (tax, title and license) fee. Some dealers say to expect to pay between 8% and 10% of the sales price in taxes and fees. This rule of thumb applies to new and used cars.

How much should you pay in dealer fees?

All dealers have one, the charge is meant to cover the cost of office personnel doing the paperwork after the sale of a new or used car. Most dealerships charge anywhere from $50 to $500 and the fee is normally not brought to your attention until right before you sign the paperwork for your vehicle.

Why is CarMax so expensive?

CarMax Cons: Their prices aren’t as low as other dealers’. The Truth About Cars analyzed the sales prices of similar vehicles on eBay and CarMax and found that their prices were consistently higher, often by a few thousand dollars. That’s because they have more overhead, which the site points out.

Why do dealers charge a processing fee?

The Processing Fee Every dealership has a processing charge; some call it a documentation fee. Regardless of the name, it’s meant to cover their cost of paperwork. It’s common to see the expense range from $100 to $400, though it varies by state.

What are the hidden fees when buying a car?

Licensing fee indicates the cost of car plates and registration, and doesn’t include any additional fees or charges added by dealer. Administration fees: These fees include transaction, financial documentation and licensing, and sometimes may also cover in-car features such as satellite radio and bluetooth.

Does CarMax charge a processing fee?

Not all CarMax locations charge a dealer fee; about 50% of the CarMax dealerships we contacted said they do not charge a processing fee or a dealer fee. … They won’t negotiate the price of the car you’re buying, but they will slightly negotiate the price of a car you sell to them.

How do you negotiate with a car dealer?

12 Tips for Negotiating With a Car Dealer1) Knowledge Is Power.2) Remember It Is a Business Transaction.3) Don’t Focus on the Payment.4) Know the Deals.5) Think About Financing Early.6) Separate the Trade-In.7) Negotiate the Price First.8) Timing Is Your Key to Savings.More items…•

Are dealer processing fees negotiable?

Dealer Documentation Fee Some states put a limit to how much a dealer can charge, but others have no cap – resulting in each dealer charging a different amount. Doc fees typically range between $55 and $700 and are usually non-negotiable.

Are dealer doc fees negotiable?

The fee is non-negotiable because the dealership is required – by law – to charge the same amount to every customer. However, you can request that the dealer reduces the vehicle’s price to compensate for that higher doc fee.