Though not technically fees, dealers often try to upsell unnecessary services or features, including these. Check with your own bank, too, which may offer a better deal and lower or no fees. The fix: Make sure you understand the payment terms before you go through an automaker’s financing arm. “And that was for on-time payments, too!” she says. For example, Diane Weiser of Port Lavaca, Texas, says she was shocked to find that every time she called to make a payment, she was charged a $10 customer service fee. Loan payment fees: Many automakers offer loans directly to car buyers-and a third of the people in our survey who got one of those loans said they were surprised by a fee connected to it. Paying extra initially also typically means losing more as the car depreciates. The fix: Still, it’s not a mandatory charge-so it’s worth asking for a discount, especially because the added cost is not just an up-front expense. Market adjustment fee: This is a tough one to avoid if you are shopping for a hot seller because dealers may have little incentive to negotiate. They’re part of the mandatory destination charge-which, by the way, should also include a full tank of gas. The cost of advertising the car is baked into the sticker price.ĭelivery and preparation fees: Dealers sometimes paste a second sticker on a car’s window next to the official one, listing charges with names like “pre-delivery inspection,” “dealer prep,” “vehicle prep,” and “vehicle procurement.” The fix: If the dealer says he will sell a car at the invoice price but you have to pay an advertising fee, just say no. Research in advance whether your state applies sales tax to the net (post-trade-in or post-incentives) or the gross cost (the negotiated price of the car).Īdvertising fee: Dealers sometimes add an extra few hundred dollars to recoup the cost of national and regional advertising campaigns. Applying available rebates and incentives can also do this. The fix: In some states you can deduct the value of your trade-in vehicle from the purchase price, which will lower the tax you end up paying. So unless you’re in one of those few that don’t charge it, you will have to pay up when buying. Sales tax: Almost every state requires you to pay sales tax on your new vehicle. The dealer may add a fee for the convenience of doing this work for you, and you’ll have to decide whether you want to contest it or if it’s worth paying. Then have the salesperson or the business manager who is handling the paperwork itemize all the registration costs, and make sure they are the same as what you found online. The fix: Before going to the dealer to finalize the deal, check the department of motor vehicles website for your state to find out the costs associated with registering a new car. But this creates an opportunity for the dealer to pad the bill a bit. While you can take care of registering your new vehicle on your own, it’s more convenient to have the dealer take care of it for you. Registration charges: You have to register your car in order to drive it, no matter where you live. The fix: You might not be able to avoid this fee entirely, but you can try for a discount or ask for something in return, such as dealer-installed accessories like winter floor mats. Documentation or conveyance charges: Though it’s reasonable for you to have to cover the cost of your title and registration (typically 1 to 3 percent of the vehicle’s cost), dealers often charge extra-sometimes hundreds more-for processing these and other documents.
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