What are car dealer fees? Car dealer fees are extra charges that a dealership adds to the final bill when you purchase a car. The most common additional fees are sales tax, vehicle registration, and a documentation fee.
Car dealerships fees can often come as a surprise to car buyers because most car dealers will not bring them up during the negotiation stage when pricing a vehicle, but rather towards the end of the process.
Every dealership has a dealer documentation fee, which covers the office personnel doing the paperwork for the sale of a new or used car. These fees range from state-to-state and typically range from $50-$500. Many dealerships will not notify you of this fee until you are singing the final paperwork for your car; however, some dealerships will negotiate the fee with you and some will even remove it.
Car buyers should be aware that 35 states do not have a limit on dealer documentation fees; therefore, car dealerships can price this fee as high as they want. Alaska has no limit on the dealership documentation fee, but the fee must be included in the price of the car.
Currently, New York has the lowest average dealership documentation fee of $75.