I know... I never really understood the doc fee either.
It wasn't until I started working at the BMW dealership until I fully understood why dealerships charge for documenting papers.
In fact, some states have specific legislation putting a cap as to what a dealership may charge as a maximum for the documentation fee. States such as California, Rhode Island, and others, seeing documentation fees ranging between $80-$200 maximum!
The dealer documentation fee in Massachusetts is something I've seen be as little as $0, and as high as $700, with little to no explanation behind the value.
Some years ago, The State of Massachusetts even investigated an extensive list of dealers inquiring how much they were charging for their doc fees, and what their reasoning behind it was. Since this report was published, many dealerships' doc fees have increased. (See Link Below)
For the most part though, Massachusetts dealerships typically charge $300-$400 on average to process all your paperwork.
What does the documentation fee usually cover?
- Handling, processing, and mailing of all lease/finance agreements to their corresponding lenders.
- Overnight or expedited shipping for vehicle titles from their respective lien-holders.
- Filing MassDOT registration paperwork either electronically (RMV Drive Program Membership is not free), or sending a "runner" to the RMV to get you license plates.
- Storing all customers paperwork for up to 5 years! Eventually, the dealership will have to hire a record keeping company to help organize this.
See where I'm going with this?
Then we have to shine light on another aspect to the necessity of the doc fee. The administrative staff does not work on commission. Handling personal, confidential, and legal documentation is not an easy task. The staff that is handling this paperwork are often working, sometimes overtime, to keep up with the documents involved with putting a deal together.
The dealer has a right to charge the documentation fee. He is fulfilling his obligation in providing you with a vehicle, and more often than not, at a reasonable price.
He has to make sure he's got enough to pay EVERYONE involved, (including the people in the back of the building) for that sale!