How to Avoid Dealership Fees

How to avoid dealer fees

Meta: Paying extra fees after you’ve already bought a car can be frustrating and a little pricey. Here’s some tips to avoid dealer fees after you’ve signed for your keys

How To Avoid Dealer Fees After Buying a Car

Once you’ve gotten approved for your car loan and are ready to drive off the lot, you may be offered a few extra services. While these may look appealing at first, certain things come with hidden fees. Don’t pay an exorbitant amount for car services that should come standard with the purchase or that you don’t need. Here are some great ways to save you money!

Car Loan and Documentation Fees

Asking to borrow money can be pricey, and there are certain fees associated with filling out the paperwork to get a car loan. Most states have a cap on the loan processing fee that they charge, but it varies by state. The loan processing fee is intended to cover the dealer’s costs of running a credit check and processing the paperwork. Most dealers will tell you that this is non-negotiable, but you may be able to talk them down a bit from the initial fee.

Destination Charge

Many dealers will charge you, the buyer, the cost of delivering the car from the factory to the dealership. This is called a delivery charge. You may also see a “destination charge” on the sticker. If you see both charges on your final invoice, you can tell the dealer that you aren’t paying the delivery charge and the destination charge.

Dealer Prep

You do need to have the dealer prep the car for you before you drive off the lot, but this is another fee that you can negotiate. They’ll charge you for the service if they can, but with a new car, all that the dealer really needs to do is have the fluids and tires checked and a quick car wash.

That being said, sometimes dealers will negotiate down one fee only to make money by giving you a lower price on the trade-in or adding on financing markups. It’s better to negotiate the price of the car separately from negotiating the fees, trade-in, and financing transactions.

Extended Warranty; Is It Worth It?

This may protect you down the line if you’re buying a used car, but it’s often not necessary with a new one. An extended warranty covers repairs after the original warranty expires. If you change your mind later, you can go back to the dealer and ask to purchase an extended warranty before your other one expires.

Fabric Protection and Paint Protection

Most modern fabrics don’t need additional treatment for fabric protection, and this is an unnecessary fee that dealers may charge you. However, if you have small children or just tend to be messy int eh car, you can treat the fabric yourself with a can of Scotch Guard.

Paint protection is another option add-on that the salesman at the car dealership will try to sell you. While you’ll love to keep the paint on your new car looking fresh, paint, too, has dramatically improved. Dealers may offer you this service for up to $500, but don’t buy in. Essentially, you’ll be getting an overpriced wax job.

Title, Tags, and Registration

These fees, you have to pay. In fact, license plate fees are mandatory by the state or county. The fees go from the dealer to the state’s Department of Motor Vehicles. This makes you legally the owner of the new vehicle and pays for the temporary tags to get you on the road. Many dealerships will also offer a service where you can pick up your new plates at the dealership, saving you a trip to the DMV.

You can expect to pay around $250 for title, tags, and registration, depending on where you live.

Advertising Fee

The advertising fee may show up on your car’s invoice listed as part of the manufacturer’s resale price, or it can be its own separate line item. This fee can be contested with the car dealer, and it can run up to several hundred dollars.

VIN Etching

insurance companies and police agree that having your vehicle VIN etched on the windows is a good idea; and it is, as a theft deterrent. However, if you have VIN etching done at the dealership, you’re paying top dollar and inflated prices; typically around $200. However many police departments or local service clubs may do this for much less, or even free.


Some dealership fees may be negotiated, while others are pretty firm. understanding what you will have to pay for when you sign on the dotted line and what you don’t can save you a bundle.