What is a dealership fee when buying used car?

A dealership fee, also known as a documentation fee or administrative fee, is a charge added by a car dealership to the price of a used car. This fee covers the costs associated with processing the sale, such as preparing the paperwork, registering the vehicle, and transferring the title.

Dealership fees can vary from a few hundred dollars to over a thousand dollars, depending on the dealership and the state in which you live. Some states have laws that limit the amount that dealerships can charge for these fees, while other states have no such regulations.

When buying a used car, it is important to ask about the dealership fee and negotiate its amount if possible. Some dealerships may be willing to lower the fee or waive it altogether, especially if you are paying cash for the car.