You’ve done your preliminary research, emailed several dealers for offers, and have decided to purchase a new car at what seems like a great price. Don’t turn that bargain into a financial trap at the last minute by failing to read the fine print on your contract. Auto dealers are notorious for slipping in services and fees that you didn’t initially agree on. Still, you have the ultimate say in whether or not you will agree to these fees. There are some which come as a standard part of any new car contract, while others may not be so necessary. It’s important to read through these carefully to determine the difference.
Common New Car Fees
There are several types of fees that you can expect to pay, whether you have found a new Audi at Carsales.com.au or at your local small town dealer. Vehicle registration fees are one of the first types of fees that everyone must pay. This will vary depending on the state or territory that you live in, but generally it’s the amount charged to register the new car, pay for the cost of license plates, and assign a legal title to the car. This proves that you are the owner of the car and makes everything legitimate. You won’t be able to get out of vehicle registration fees, so work these into your budget by researching what they are in your state.
Sales tax is another extra fee to pay on new cars. Unfortunately, this can be higher than you expect if you’re not prepared for it. If you purchase a bargain car at $10,000, a basic 8 percent tax rate would mean that you have to pay an additional $800 on top of this. Again, this will vary by state or region. Many dealers charge documentation fees for the completion of paperwork. These administrative fees could be tacked on at the last minute and catch you unaware. If you don’t like what you see, you may need to negotiate a lower sale price to offset this type of fee.
Other Types of Fees
The types of fees mentioned above are standard for almost every new car purchase. Yet there may be other fees that work their way into your contract, including dealer fees. They may charge you for shipping or extra paperwork on top of the documentation fee. Advertising fees are another potential cost. Some dealers will add this into the contract as a way to offset the cost of their own business’s advertising, while others are required to include this fee by the car’s manufacturer. As you browse through your contract, be sure to ask what these are if you see any fees that you don’t recognize, and don’t be afraid to negotiate if you don’t think you should pay them. Go through the contract carefully before signing to see if any fees have been added at the last minute.
After carefully taking the time to compare auto prices and get the best deal in your area, don’t let yourself down by failing to read your contract carefully. Most auto purchases can be negotiated right until the end, down to the fine print.
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