What exactly is a dealer doc fee?

When it comes to big ticket purchases, outside of buying a home, they don’t get much bigger than the financial commitment that comes with buying a car. And if you’re anything like the majority of Americans who have made vehicle purchases the past few decades, you also know that making that commitment often comes with striking a deal with the dealership.

With that, it also means that you’re forced to square off with a salesperson whose motivation is primarily fueled by his or her desire to increase the dealer margins or their own commission. From there – if you’ve somehow managed to maintain your sanity after settling on a car to buy – you step into the backroom to finalize the deal and sign contracts. It’s then at this point in which you’re victimized by a cascade of fees and additional costs that make you wonder if you’re also getting charged for breathing the oxygen on their property.

One of the most common fees you’ll come across at your standard brick and mortar dealership is a document fee, more commonly referred to as a “doc” fee. In comparison to some of the other mind-blowing charges you’ll find at the dealership, doc fees are especially anger inducing. In summation, a doc fee is the fee a dealership charges to supposedly cover the cost of preparing and filing the sales contract on the vehicle and other paperwork. But as AutoTrader asks, “Shouldn’t the purchase price cover those costs? After all, if a dealership makes a profit on each car sold, shouldn’t some of that profit go to paying each employee?”

For many, the concept of an additional charge like this feels like dealerships are at the very least taking their pound of flesh, if not participating in a business practice that borders on racketeering. The truth of it is that most states don’t regulate the amount a dealership can charge for the price of a doc fee. This means that depending on where you live, a dealer can up-charge you just about whatever they darn well please. In fact, there are only 10 states that have doc fee limits, with the national average hovering around $282. (Florida checks in at number one nationally for most expensive average doc fee, charging a whopping $670!) Often times, dealership managers will tell you that the doc fee is non-negotiable, but as U.S. News & World Report says, it only is if you don’t hold the dealer’s feet to fire.

At the end of it all, you’re emotionally and physically spent from the exercise of continuously trying to clarify what the true bottom line price of your vehicle is. Fortunately, you can avoid getting put through this ringer entirely. Never will you ever be charged a doc fee – or any other additional or hidden charge for that matter – with Carvana. In fact, the only extra charge on top of the retail price you’ll receive is one you apply yourself if you choose to have your vehicle delivered outside one of our service areas, and/or add additional vehicle protection to your purchase with Carvana Care. When you buy a car from us, you can do so with the confidence in knowing that the price listed is the price you can expect to pay – no additional fees, no hidden charges, no intense backroom negotiations. This is the new way to buy a car.