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Old 09-13-2010, 10:01 AM
 
14,777 posts, read 34,498,385 times
Reputation: 14278

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Quote:
Originally Posted by ShadyOaksGirl View Post
So...I finally get my paperwork Friday and found a lot of errors and numbers that don't add up. Someone please help me understand just what in the **** I'm looking at here and WHY I'm seeing discrepancies!!

Taken verbatim from the Retail Buyer's Order:

Cash Price of Vehicle: $18,872.00
Accessories: zero
Less Pre-owned Allowance &/or Discount: N/A
Net Difference $18,872.00
Dealer Delivery Fee: $595.00
Electronic Registration Filing Fee and Processing Fee: $69.95
Lead Acid Battery Fee: $1.50
Florida New Tire Fee ($1.00 per tire): N/A
Subtotal: $19,538.45
Sales Tax __%: $586.15
County Tax: $50.00
Lemon Law - Warranty Enforcement Act (New cars only): N/A
Florida Title, Registration and License Fees (New __ Trans __): $220.00
Trade Pay-off / Balance on Prior Lease: N/A
Subtotal: $20,394.60
Motor Vehicle Service Contract: $1,866.00
Vehicle Maintenance Agreement: N/A
Doc Stamps, Gap Ins: $779.10
Sales Tax on Other Benefits: $130.62
GRAND TOTAL: $23,170.32
Rebate: N/A
Cash (Receipt #____): $600.00
Total Cash Down: $600.00
Balance Due On Delivery: $22,570.32

First, the sale price of the vehicle as listed is $18,372. The additional $500 included on the RBO is supposed to be a fee that the subprime lender (Santander) requires the dealership to pay in order to finance my loan. The salesman flat out told me he wasn't eating the cost on this and that fees of this nature can run into the thousands, so I was getting off relatively easily. However, I don't understand why I haven't been provided with documentation of this (for the record, I haven't been provided *any* documentation from the lender, leading me to believe that I haven't really been approved for financing of any kind). Am I simply to take him at his word?

Second, is it normal practice to be charged sales tax on the sales price PLUS all the fees?

Third, the sales tax on this vehicle is 7.00% (6% state, 1% local). At the very LEAST, I should be charged in the neighborhood of $1,286 for sales tax, yet the three lines on the RBO dedicated to tax (of any kind) don't remotely add up to this figure.

Fourth, how are my own state's taxes and registration/title/highway use fees accounted for? I was told initially that I would not have to pay BOTH of the state's taxes and registration/title/highway use fees, that some kind of "reciprocal" agreement exists that would ensure I only pay my own state's fees.

Fifth, the price of the Motor Vehicle Service Contract was $1,800 according to the F&I guy; so why is it $1,866 on the paperwork?

As you can tell, I'm pretty naive to this process; it is only my third dealer purchase in 23 years of adulthood (and my first out-of-state purchase). I'm trying to be thorough and learn, but I can't help but feel something just ain't right here. I haven't signed ANYTHING and won't until such time as I feel comfortable with what each penny of this contract represents.
1. Like I thought earlier they are having a real hard time getting the deal done do to your credit situation. If you are at the point of needing to pay an origination fee on the financing, I think you really need to reconsider buying a car. What is the APR they are charging you? Generally there shouldn't be a fee at all and anyone trying to collect one is simply gaming profit. However, if the credit situation is really bad, this is a lender of last resort and the fee can be normal. The fee is essentially buying down the APR. Santander is not a fly-by-night finance company, it's actually the 8th largest bank in the world. Santander is a major international bank based out of Spain. This year they got real big with subprime auto financing when they acquired HSBC and Triad. So, this is not some "off-brand" lender.

2. Each state is different in how it calculates what is and isn't taxable as part of the deal. Generally all portions of the sale outside of registration fees are taxable. In this instance it looks like the $69.95 e-file is part of the registration, but this is actually a dealer service and hence taxable. The actual reg fee isn't taxed. So, anything you buy, the car, add-ons, services, etc. are all taxable. Only state and local fees are not.

3. It looks like they are charging you Florida tax and fees and doing a Florida registration. If you don't live in Florida, this can be a problem. You need to look into the rules regarding your state and what the reciprocal agreements are with Florida. This is an area that they may have screwed up on.

4. You should not have to pay both, see number 3 above. Each state can be different depending on how the agreements are arranged. Generally regardless of where the vehicle is purchased you should be paying all applicable fees and taxes to the state it is to be REGISTERED in. I think they screwed up and just put in the numbers for Florida, definitely call them on this.

5. $1,800 was most likely a ballpark quote, the actual price is $1,866. Nothing said verbally is binding, only what is put on the contract. You can argue this as the price is probably massively inflated anyway.

So, I think there are no errors in the contract, outside of charging Florida taxes and registration, when it should be your states taxes and registration.

With that said, there are a couple areas where they are dinging you:

1. The $595 delivery charge should not be there. This is a used vehicle, so there is no delivery fee unless this is what they are charging to drop the car off to you. If this is what they are charging to deliver the car to your house, then this is legit. If not, this is nothing more than padding their profits.

2. The $69.95 e-file fee is BS as it is being taxed, that means it's not a state thing. They are simply charging you a service fee to register the vehicle. Since they are also charging a doc fee, this is essentially double dipping.

3. The Service Contract is totally an add-on service. You stated you wanted it, but these contracts can be real touchy regarding deductibles and what is and isn't covered. I recommend skipping it and buying one third party. This is also really affecting the LTV on the loan since it is rolled in and this is most likely making the loan harder to sell.

4. Doc Stamps and Gap Insurance should be seperated out. Florida is tricky as there is no limit as to what the dealer can charge for doc fees. Doc fees are a routine charge, but are negotiable. You need to know what they are charging for GAP as well, as this is something else that can be bought cheaper from another party. Adding this service also makes the loan harder to sell since the LTV is higher.

So, while there is some "dealer tricks" in the contract, it is nothing crazy. You really need to figure out the registration thing as that is the most obvious mistake. Also, since the loan is subprime and the financing is difficult, you really need to maybe rethink the whole thing.
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Old 09-13-2010, 10:03 AM
 
Location: Central Texas
13,720 posts, read 24,613,257 times
Reputation: 9173
You are buying a car out of state. Are they shipping it to you? If so - $600 or so is a typical car shipment fee depending on the distance.

Why are you buying a service plan? Is this car not reliable? $1800 is a lot of money for a service plan (extended warranty?) unless this is a high end car (which it probably is not at $18K).

Obviously this car is in Florida. Where do you live? You should find out what the rules are for sales tax in your state. Normally you will only pay sales tax where you register the car.
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Old 09-13-2010, 06:20 PM
 
41 posts, read 152,475 times
Reputation: 25
1. The $595 delivery charge should not be there. This is a used vehicle, so there is no delivery fee unless this is what they are charging to drop the car off to you. If this is what they are charging to deliver the car to your house, then this is legit. If not, this is nothing more than padding their profits.

2. The $69.95 e-file fee is BS as it is being taxed, that means it's not a state thing. They are simply charging you a service fee to register the vehicle. Since they are also charging a doc fee, this is essentially double dipping.

Told the F&I guy I was not happy about the $595 and $69.95 fees. He told me every dealer in the state charges this. So, how do I counter? Do I tell him that's a load of crap and I'm not paying it?

3. The Service Contract is totally an add-on service. You stated you wanted it, but these contracts can be real touchy regarding deductibles and what is and isn't covered. I recommend skipping it and buying one third party. This is also really affecting the LTV on the loan since it is rolled in and this is most likely making the loan harder to sell.

Hubby wanted this but I convinced him to talk to a third party. He did, so that's what we're doing rather than buy it through the dealer and tack it onto the loan.

4. Doc Stamps and Gap Insurance should be seperated out. Florida is tricky as there is no limit as to what the dealer can charge for doc fees. Doc fees are a routine charge, but are negotiable. You need to know what they are charging for GAP as well, as this is something else that can be bought cheaper from another party. Adding this service also makes the loan harder to sell since the LTV is higher.

I have had no luck finding a seller for GAP insurance. I talked to our Dept of Insurance today and was told that it's not really insurance, per se, and is not regulated as such. Guy told me that this was really just a contract and was sold through lenders or financial services companies. For X in fee, we will cover the difference between the assessed value and the loan (at point of totaling the vehicle, if it comes to this). The cost for GAP through the dealer is $700. I imagine that is directly linked to the terms of the loan, as a friend of mine only paid $250 on a 5.5% APR. I will probably opt out of this completely as well.

I was able to get to the bottom of the $586.12 sales tax. It is 3% of the $19,538.45 subtotal and represents the sales tax required by my state (NC). I misunderstood the tax chart and thought this was a separate fee over and above the 7.75% state sales tax.

The only other discrepancy is around the $50 County Tax and the $220 Title, Registration and License Fee. Still not sure about that $50, but I confirmed today that our DMV fees would be less than $100 if we purchased the car inside NC. The F&I guy tells me that "this is what your DMV gave us," but what he *meant* to say (LOL) is that the dealer pays a third party to handle out-of-state registration matters and the extra $120 is their fee for the privilege. That's my belief, anyway, based on a form included in my package from the DMV Nationwide Processing Center.

I know it seems like I should walk away completely since this seems so messy (bad credit score aside), but I'm trying to *learn* and appreciate all of your input.
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Old 09-13-2010, 06:24 PM
 
Location: Austin Texas
474 posts, read 739,808 times
Reputation: 531
I don't think anyone has asked this yet. Why are you buying this car out of state? Is it an unusual car you can't find in NC?

I bought a car out of state from an individual - but only because I couldn't find this particular car closer to home. Otherwise I wouldn't go to the trouble you're going through.
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Old 09-13-2010, 06:27 PM
 
41 posts, read 152,475 times
Reputation: 25
Quote:
Originally Posted by jazznblues View Post
I don't think anyone has asked this yet. Why are you buying this car out of state? Is it an unusual car you can't find in NC?
Yes, it's the "limited" trim of a vehicle I've had my eye on for a long time. I drive cars until they die (our current vehicles are 15 and 16 years old), so I am trying to get what I want, knowing I'll have it for a long time.
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Old 09-14-2010, 07:13 AM
 
14,777 posts, read 34,498,385 times
Reputation: 14278
Quote:
Originally Posted by ShadyOaksGirl View Post
Told the F&I guy I was not happy about the $595 and $69.95 fees. He told me every dealer in the state charges this. So, how do I counter? Do I tell him that's a load of crap and I'm not paying it?

Hubby wanted this but I convinced him to talk to a third party. He did, so that's what we're doing rather than buy it through the dealer and tack it onto the loan.

I have had no luck finding a seller for GAP insurance. I talked to our Dept of Insurance today and was told that it's not really insurance, per se, and is not regulated as such. Guy told me that this was really just a contract and was sold through lenders or financial services companies. For X in fee, we will cover the difference between the assessed value and the loan (at point of totaling the vehicle, if it comes to this). The cost for GAP through the dealer is $700. I imagine that is directly linked to the terms of the loan, as a friend of mine only paid $250 on a 5.5% APR. I will probably opt out of this completely as well.

I was able to get to the bottom of the $586.12 sales tax. It is 3% of the $19,538.45 subtotal and represents the sales tax required by my state (NC). I misunderstood the tax chart and thought this was a separate fee over and above the 7.75% state sales tax.

The only other discrepancy is around the $50 County Tax and the $220 Title, Registration and License Fee. Still not sure about that $50, but I confirmed today that our DMV fees would be less than $100 if we purchased the car inside NC. The F&I guy tells me that "this is what your DMV gave us," but what he *meant* to say (LOL) is that the dealer pays a third party to handle out-of-state registration matters and the extra $120 is their fee for the privilege. That's my belief, anyway, based on a form included in my package from the DMV Nationwide Processing Center.

I know it seems like I should walk away completely since this seems so messy (bad credit score aside), but I'm trying to *learn* and appreciate all of your input.
Florida has no caps on what dealers can charge for doing business. The $595 delivery fee is nothing but add-on profit for the dealer. This is a point I would argue strongly. For me, it would be a deal breaker.

The $69.95 may be a somewhat legitimate fee. The state may charge that (or another amount) for e-file to the dealer. The dealer is simply passing it through to you. I would argue that since you are paying a doc fee, it should be counted there, but I wouldn't let the deal fall apart over it.

Good news on going with a 3rd Party for the service contract. Those types of add-ons are just pure profit makers for the dealer.

Just google GAP Insurance and you will find multiple sources. The cost is generally low and is not tied to the loan in anyway. Generally it should cost around $250. Anymore than that and the person selling the coverage is just pocketing profit.

Good to see the sales tax got worked out.

The county tax could be a Florida thing or it could be a NC thing. The county in Florida may have a rule that all cars sold in the county have "x" tax charged. I would just ask for clarification.

It does seem like they are passing through the cost of their 3rd party title agency to you. Generally this is something that should be covered in the doc fees. From what you said though, they seem to be charging a very small doc fee on the Doc/GAP line. They may just be breaking out all of the costs individually. In their defense, while it could be considered cost of doing business, most dealers do pass on these kinds of fees.

So, overall once we have gotten through the mess, outside of the $595 destination charge, I really don't see any issues with the contract. That $595 is added on profit pure and simple. I would have no problem with the contract as is as long as the $595 was removed.
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Old 09-14-2010, 07:57 PM
 
41 posts, read 152,475 times
Reputation: 25
I tendered a counter-off to the dealer this morning: Cut the dealer delivery fee from $595 to $250 and the electronic processing fee to $50. Eliminated vehicle maintenance contract ($1866) and GAP ($700). Told him I wasn't buying the $270 he was charging for the tag/title as being gospel from the DMV, included a copy of the DMV fee info taken verbatim from their website, and advised him I would not pay more than $73 unless he could provide proof that my DMV required otherwise.

He emailed me squealing, told me the original paperwork would be signed as is or there would be no deal. So I emailed him back -- no deal.

He emailed me AGAIN squealing nonsense about the delivery fee not being negotiable, the DMV fees taken straight from them, blah blah blah. Responded letting him know I wasn't budging from my position. The vehicle is priced fairly, but I'm not paying inflated fees. I threw him a bone as it was...I didn't ask him to eliminate the deliver fee/e-processing fee altogether, just lowered it to a "fair and reasonable" amount.

So we go back and forth a couple times about the DMV fees and how they're accurate as given by the interstate title services company they use blah blah blah. Asks again -- do we have a deal or not? Uh, no, not if you're sticking to your story and not changing the numbers. Also took the opportunity to point out how excruciatingly LONG this whole process has been, which was entirely unnecessary.

So, that's that. Car's back on the lot, I'm free to peruse other options, fat lady has sung. Thanks to all of you, especially NJGoat, for taking the time to weigh in and help me learn.
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Old 09-16-2010, 06:10 AM
 
Location: Gainesville, VA
1,259 posts, read 4,955,580 times
Reputation: 718
Wonders what car we were talking about...
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Old 09-16-2010, 07:41 AM
 
14,777 posts, read 34,498,385 times
Reputation: 14278
Quote:
Originally Posted by ShadyOaksGirl View Post
I tendered a counter-off to the dealer this morning: Cut the dealer delivery fee from $595 to $250 and the electronic processing fee to $50. Eliminated vehicle maintenance contract ($1866) and GAP ($700). Told him I wasn't buying the $270 he was charging for the tag/title as being gospel from the DMV, included a copy of the DMV fee info taken verbatim from their website, and advised him I would not pay more than $73 unless he could provide proof that my DMV required otherwise.

He emailed me squealing, told me the original paperwork would be signed as is or there would be no deal. So I emailed him back -- no deal.

He emailed me AGAIN squealing nonsense about the delivery fee not being negotiable, the DMV fees taken straight from them, blah blah blah. Responded letting him know I wasn't budging from my position. The vehicle is priced fairly, but I'm not paying inflated fees. I threw him a bone as it was...I didn't ask him to eliminate the deliver fee/e-processing fee altogether, just lowered it to a "fair and reasonable" amount.

So we go back and forth a couple times about the DMV fees and how they're accurate as given by the interstate title services company they use blah blah blah. Asks again -- do we have a deal or not? Uh, no, not if you're sticking to your story and not changing the numbers. Also took the opportunity to point out how excruciatingly LONG this whole process has been, which was entirely unnecessary.

So, that's that. Car's back on the lot, I'm free to peruse other options, fat lady has sung. Thanks to all of you, especially NJGoat, for taking the time to weigh in and help me learn.
Congrats, lol. It's always better to let a "bad" deal go by, there is always another car out there. Just keep looking and I'm sure you will turn up the kind of car you are looking for. Also, try to stick to your own state, just for the ease of doing business.
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Old 09-16-2010, 08:40 AM
 
Location: Central Texas
13,720 posts, read 24,613,257 times
Reputation: 9173
ShadyOaksGirl - that dealer is shady. You did the right thing.

What kind of car was this?
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