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Car Buying and Financing FAQ

What Are Dealer Fees, and Can You Avoid Them?

What Are Dealer Fees, and Can You Avoid Them?

Dealer fees are additional charges added to the price of a car by the dealership. These fees cover various costs, such as paperwork processing, vehicle preparation, and advertising. Common dealer fees include documentation fees, destination charges, and market adjustment fees.

While some dealer fees are mandatory, such as destination fees set by the manufacturer, others—like documentation or dealer prep fees—may be negotiable. Here is how you can minimize or avoid them:

  • Negotiate: Some fees, such as documentation or preparation fees, can be reduced or waived if you negotiate effectively.

  • Compare Offers: Shopping around and getting quotes from multiple dealerships can help you find the best deal with lower fees.

  • Look for No-Hidden-Fee Dealers: Some dealerships advertise transparent pricing with no unnecessary add-ons.

  • Review the Purchase Agreement: Always check the final breakdown of fees before signing to ensure you are not overpaying for unnecessary charges.

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