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Here are the hidden fees you need to watch for when buying a car

Wouldn’t it be nice if, when buying a car, you just paid the vehicle itself and nothing more?

Unfortunately, that’s not the way it works. Plenty of other add-on charges you never saw coming can wind up on the final bill. The good news? It’s possible to sidestep some of these fees altogether or negotiate to get them lowered.

Consumer Reports compiled a list of all the extra fees dealerships will try to get you to pay and how you can either negotiate or contest them.


Negotiable Fees


Delivery and preparation fees

When you buy a car from a dealer, there will sometimes be a sticker on the vehicle’s windshield beside the price sticker that displays fees for things like “pre-delivery inspection,” “vehicle prep,” vehicle procurement,” or “dealer prep.”

According to Consumer Reports, you should try to fight these fees, since they’re already a part of what’s called the “mandatory destination charge,” which is what the manufacturer charges for delivering the vehicle to the dealership.

Advertising fees

You shouldn’t blindly accept an advertising fee, which dealers will sometimes charge in order to make up for the money spent on advertising campaigns for the vehicle. The ad fee is should already be included in the sticker price, Consumer Reports says.

Fees for making (on-time) payments

If you’re taking out a loan from your dealer in order to buy the car, watch out for fees hidden in the contract. A Texas woman found out the hard way that every time she made a loan payment she was charged an extra $10 as a “customer service fee,” according to Consumer Reports. 

One of the best ways to avoid this fee, Consumer Reports says, is to read the fine print of your contract and shop around to see if you could get a better loan agreement somewhere else — one with either fewer fees or none at all. 

Documentation/conveyance fees

When you buy a car, you pay for the title and registration. But keep an eye out to see if your dealer charges you extra for processing these documents for you. Consumer Reports says that while you may not be able to contest the processing fee, you could ask for a discount on it, or for some free car gear in exchange.

Market adjustment fees

If you’re buying a new and popular vehicle, there might be a market adjustment fee tacked on to the final price. Essentially, it means the dealer is increasing the price of the car simply because this particular make is popular at the moment. Why? Because they can.

The dealer will likely not want to budge too much on this one, but it’s worth asking for a discount, especially because paying more upfront usually means you’ll lose more as the car depreciates, according to Consumer Reports.


Contestable Fees


Extended warranty 

Designed to kick in after the manufacturer’s warranty on the vehicle ends, an extended warranty can seem appealing. But Consumer Reports says that it can add thousands of dollars to the cost of the vehicle, so it says you might be better off building up an emergency savings account to deal with any costly repairs that arise after the warranty expires.

Vehicle Identification Number (VIN) etching fee

In an effort to upsell buyers, a dealer might offer this anti-theft service, which involves etching the VIN into the car’s glass. But Consumer Reports says you can get this done for less at a mechanic or you can even do it yourself with a kit that can cost as low as $20.

Rustproofing, paint sealing, or fabric protection fees

Another upsell attempt, rustproofing, paint sealing, and fabric protection are services the dealer will offer before you sign on the dotted line. But they aren’t necessary — and can actually cost hundreds of dollars extra. According to Consumer Reports, vehicles today are already made to be able to handle “corrosive weather and road conditions.” 

Plus, paint sealants are just a fancier version of wax that, after a few months, will wear off anyway. “Interior protection” amounts to having the car seats sprayed with expensive protectant. 

Disability and life insurance

Dealers will usually try to sell you disability and life insurance when you take out a loan. The policy will help pay down the loan should you ever get seriously injured or pass away before it’s fully paid off. But Consumer Reports says it’s cheaper to get this kind of coverage through your auto, home, or life insurer, than through the dealer.