Question – We responded to a radio ad from an individual selling a car. We agree on a purchase price and made arrangement to meet the person at a back to give them our check. At the last minute, they called and wanted to meet at Kruse Motors in Worthington, MN because she had found a car there and and wanted to run the paper work (trade in)through the dealership to “save” her tax liability.
I specifically told Kruse Motors that we would do it that way to save their client on the tax. When all was said and done…they turned around and charged me $50.00 for a documentation free when I specifically said that we were only doing this to save their client money and that I would NOT pay any additional fee to the dealership. Unfortunately, my daughter and granddaughter finished the deal in my absence and the dealership did in fact tack on that $50.00 fee. (four people hear the verbal deal and agreed that I would not have an additional charge). I explained to the dealership that I could take the paperwork to the courthouse and do the title transfer myself.
I went back to the dealership to complain and they claim they are “required” by law to charge $50.00… which I have not gotten back. They also charged me 6.5% tax on a 2495 car only to find out they had overcharged me on that too… (I did get all by $10.00 back)
I would like to see a “requirement by law” that states dealerships HAVE to charge a documentation fee. can you give me the MN state statute regarding that?
Answer - What you are describing is typically called a courtesy delivery and is fairly common when someone is selling their old car instead of trading it on a newer vehicle. A transaction of this nature usually only benefits the private party seller; they are either selling the car for more money than the dealer was willing to pay or it’s being sold to a friend or family member and then saving sales tax on the final price. Granted, the dealer benefits from the resulting car sale but, in the end, the new car usually gets sold either way.
In answer to your question, you are correct, there is no legislation that requires a dealer to charge document fees. The amount the dealer can charge is regulated by the State but the dealer is not required to charge it. However, it is illegal for a dealer to discriminate by choosing who is charged the fee. Essentially, it’s the “what’s good for one is good for all” principle. If one person has to pay, then every retail customer of the dealership has to pay. The one who should feel obligated to pay in this case is the one who received the most benefit, the person who sold the car to you. You might also want to do further research on the subject of handling the titling and registration yourself. I do believe a Minnesota dealer is required to handle the title transfer and vehicle registration on units sold to State residents.
I think the biggest issue is that you were lead to believe there would be no additional fees and in the end there was. I recommend talking directly, in person, with the owner of the dealership and expressing your concern. A calm and reasonable discussion with the guy who signs the checks should handle this relatively fast.
I hope this helps and please feel free to call me with any further questions you may. I have moved to a new dealership, Kia of Fargo, and can now be reached at 701.281.9165.
Dan Anderson
CarManDan
http://www.carmandan.com
http://www.kiaoffargo.com
