PHOENIX (3TV/CBS 5) – Buying a car can be both exciting and frustrating at the same time. Once you think you arrived at the price you can afford, you’re hit with something called a“documentation fee.”
“It’s something a dealership charges for processing the paperwork,” Ron Montoya, senior consumer advice editor with Edmunds.com, told On Your Side. “You really can’t negotiate it. You just have to pay it.”
Montoya said that consumers are shocked when they think they struck a deal on a car only to find hundreds of dollars are added at the bottom of the contract. In other words, you’re basically paying the dealership to buy the car. If the doc fee impacts your purchase, he suggests trying to re-negotiate the price of the car to offset the fee. However, that can be difficult since the auto industry is in a “seller’s market.”
The median documentation fee here in Arizona totals close to $500, Montoya said. “The median, which is the middle amount that people are paying is about $499 for Arizona based on our data,” Montoya said. “It is something most people don’t know about, so it’s something you probably want to ask early on so you don’t get caught off guard.”
Arizona car buyers don’t have the same luxuries that other state residents have. Some states have limits on these fees. For example, in California dealers can’t charge more than $80. “There is no limit in Arizona,” Montoya said. He says that in theory, dealerships can charge whatever they want. When it comes to documentation fees, consider it the cost of doing business with a dealer. Remember that there is no documentation fee when you buy from a private seller, and there’s no sales tax either.
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