Category Archives: Auto Financing

Car Dealer Fees: What You Can Avoid & What You Can’t

You’re about to get a great deal on a new car. The sales person agreed to your number. Yay! But then you see the final paperwork. And the fees just keep piling up. Do you have to pay the doc fee? For VIN etching? And what’s a destination charge? All of a sudden, it doesn’t feel like you’re getting such a great deal after all. You feel swindled.

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Follow along as we explain various car dealer fees and how you can avoid certain ones.

Car Dealer Fees – Explained

Car Dealer Fee What It Is Can You Avoid It?
Destination Charge Cost to transport the car from the manufacturer to the dealership No
Title and Registration Fee Cost to establish you as the vehicle’s owner and the get the vehicle properly registered in your state No
Documentation/Doc Fee Cost to process your documents and paperwork at the dealership No
State Sales Tax Charge levied by state government No
Advertising Fee Fee passed through from the manufacturer to help pay for promoting the car Maybe
VIN Etching Fee Fee to have the VIN etched into the car’s windows Yes
Dealer Financing Markup An amount of money the car dealer adds on to dealership financing, either through the interest rate or on top of other ancillary products Yes

What’s a Destination Charge?

A destination charge is a fee that’s set by the automaker. It covers the cost to transport the vehicle from the factory to the dealership, and it’ll be listed on the car’s window sticker.

You generally have to pay the destination charge. BUT (and this is a big BUT), Consumer Reports notes that some dealerships get sneaky and tack on things that sound like destination charges but really aren’t.

“If you see additional ‘pre-delivery inspection,’ ‘delivery,’ ‘destination,’ or ‘dealer prep’ charges, you should refuse to pay them,” says Consumer Reports.

What’s a Title and Registration Fee?

The title and registration fee pay for your vehicle to be properly titled and registered in the state. Most dealerships have agreements with the state’s Department of Motor Vehicles so you can take care of the title and registration at the dealership, without have to visit the DMV. Some dealerships will issue you temporary tags. Others will provide you with permanent license plates. The title and registration fee is set by the state and is not negotiable.

What’s a Doc Fee for Cars?

A doc fee, or documentation fee, is a fee that’s charged to cover the cost of processing a vehicle’s paperwork. It helps pay for the dealership staff you probably don’t see, like the people who handle money and set up the title and registration with the DMV.

Most states don’t put a cap on doc fees, but some states do. Find your state on this list of average dealer documentation fees by state. Dealerships in states that don’t regulate doc fees have been known to charge doc fees of several hundred dollars.

So, do you have to pay doc fees? According to Auto Trader, the answer is yes and no. What you want to focus on is negotiating the bottom-line number.

“If you’re prepared to pay a certain amount of money with tax for a car, you should ask the dealer to deal in his bottom-line or out-the-door price — a price that includes the doc fee… That way, you’re not haggling over the exact dollar amount of fees and taxes… Instead, you’re focused on the price you pay overall, and if the dealer wants to include a doc fee in that price, then so be it.”

What’s a State Sales Tax?

The word “tax” should tip you off here. Can you think back to a time when you’ve been able to avoid paying taxes of any kind? (Except tax-free weekend if your state participates in that program!) Sales tax is not negotiable.

You’ll need to pay sales tax when buying a vehicle. You may have to pay tax on the full amount, or the purchase price minus a trade-in. If you’re buying a car out of state, you’ll pay sales tax when you register the vehicle in your home state. Sales tax varies by state. Check out this list to view car taxes by state.

What’s an Advertising Fee?

Auto manufacturers will add a charge to each car that’s delivered to the dealership to help pay for a brand’s national advertising — think newspaper, radio, magazine, and TV ads.

According to U.S. News and World Report, “Some dealers will try to get customers to pay twice: first, as part of the invoice, and then again as a separate fee when the purchase is finalized.” Watch out for a duplicate advertising fee — it’s one car dealer fee you can avoid.

What’s a VIN Etching Fee?

This car dealer fee is exactly what it sounds like. You can pay to have the vehicle identification number etched into the car’s windows. It’s an anti-theft measure and while highly recommended by insurance companies and the police, VIN etching is something you can do at home or through your local police department at a much lower price. DIY kits on Amazon start at about $17. You can expect to pay $200 or more at the dealership. VIN etching is optional and you do not need to pay this fee when buying a car.

Beware of the Dealer Financing Markup (the Fee You Don’t See)

The car dealer fees we’ve reviewed thus far are ones you can typically see clearly outlined in your final paperwork. There’s another fee, however, that could remain “hidden” — the dealer financing markup.

Data released for “2018 show that consumers paid an average of $1,791 in undisclosed fees and markups, a 5% increase from 2017 and a 71% increase since 2010,” reports Outside Financial via PR Newswire.

Why is this? Car dealer fees have become increasingly transparent, with outlets like Consumer Reports and even myAutoloan raising awareness about fees you can avoid and those you can’t. In response, “dealers have increasingly relied on loan markups to grow profitability.

Dealer markups on auto loans are one major car dealer fee you can avoid.

Jon Friedland, CEO of Outside Financial, estimates that in 2018, “By shopping for car loan packages before they go to the dealership to buy their cars, consumers could have saved $1,000 in hidden fees and markups on each of these loans.”
Reading about car dealer fees may make you feel like you’re at the mercy of the dealership — but you’re not. When you’re a cash buyer, you can be in control from the moment you set foot on the lot. Take the advice of Outside Financial and get to know your financing options ahead of time. Don’t fall victim to hidden markups on dealer financing. Start the process with myAutoloan. Submit one application and see up to four financing offers in minutes.

7 Steps to Buy Your First Motorcycle

You’re new to motorcycles. You’ve only driven a bike a few times, but when you did, it was exhilarating. You can’t wait to own a motorcycle of your own and now, you’re finally ready. But is buying a motorcycle the same as buying a car? Where do you start? We may have “auto” in our name, but we know motorcycles, too. Follow these seven steps to successfully (and safely) buy your first motorcycle.

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How to Buy a Motorcycle

1. Learn how to ride.

It doesn’t make much sense to buy a car if you don’t know how to drive. The same can be said for buying a motorcycle. Plus, some states require official motorcycle training in order for you to get a bike license.

It doesn’t matter whether you have a driver’s license or not, or how long you’ve driven a car. Driving a motorcycle requires different skills than driving a car. Motorcycling is equal parts fun and dangerous. Completing a motorcycle training course will help you gain the skills you need to maximize the fun part and minimize the dangerous part.

A course will also give you the opportunity to try out different bike styles and connect with people in the industry who can give you pointers on how to buy a motorcycle in your area and where to find the best deal.

Start with the Motorcycle Safety Foundation. It’s an internationally recognized rider training program and can connect you with courses near you.

2. Decide between a dealer or private seller, new or used.

So, you learned how to ride and you passed a motorcycle training course. Congratulations! Are you comfortable buying a motorcycle from a private seller, or would you rather buy through an official dealer?

Where you’re comfortable buying a bike will also play into whether you’re going to buy a new or used motorcycle. Dealers are likely to have both types of bikes in-stock. Go with a private seller and you’ll be buying used. Consider these pros and cons.

Buying a New Motorcycle vs. a Used Motorcycle
New Motorcycle Used Motorcycle
Price More expensive Less expensive
Condition Perfect, plus has the latest features; probably comes with a warranty May need some service and could be missing latest technology; no warranty
Experience A reliable dealer has reviews, a website, and you can verify their business history and the bike history You can’t be sure who you’re buying the bike from or where the bike has been if you purchase from a private seller, and you may be uncomfortable meeting a stranger

3. Finance the motorcycle.

Once you know whether you plan on buying a new or used motorcycle from a dealer, or a used motorcycle from a private seller, you’ll want to secure financing. This part is pretty similar to buying a car! Getting pre-approved for financing beforehand has many advantages. As NerdWallet notes:

  • You’ll be made aware of credit problems ahead of time (and potentially fix them).
  • You can play with the loan terms and pick the terms that fit your needs.
  • You can show the salesperson that you’re an informed and serious buyer.
  • Pre-approval strengthens your negotiating power.
  • Pre-approval could encourage a dealer to counter with a lower interest rate.

But don’t rev your engine for the first motorcycle loan option that comes your way. Compare all of the financing options available to you using a service like myAutoloan. Fill out one application and we’ll present you with up to four motorcycle financing options so you can select your best rate.

4. Get motorcycle insurance quotes.

Just like you need auto insurance to stay legal when driving a car, you also need motorcycle insurance when you drive a motorcycle. Get insurance quotes beforehand to see how rates vary by insurance company and motorcycle type. Your financing company will probably require that you buy a certain amount of insurance, too.

Motorcycle insurance costs can vary greatly depending on the type of bike and its accessories. You might be looking at two bikes that have the same sticker price, but one costs hundreds of dollars more to insure each year. An insurance quote can help you avoid surprises and help you make a good buying decision. Start with a quote from one of our insurance partners.

5. Browse bikes, but don’t expect a test drive.

Go online or to the dealer of your choice to start browsing bikes. Unlike buying a car, motorcycle test drives are not standard. There are far too many safety and insurance concerns.

If you’re an experienced rider with the driver’s license endorsement and training to back it up, you can probably schedule/request a test drive at a larger dealership like Harley-Davidson or Kawasaki. But you might encounter some roadblocks as a new rider. Your best bet is to research demo days in your area and sign up for ride time. You can also attend motorcycle rallies, shows, and races, as most major manufacturers will send demo fleets to these events.

6. Buy the right safety gear.

There’s tons of steel, glass, and plastic surrounding you when you drive a car. If you collide with something, an airbag will go off to cushion the impact. A motorcycle has none of these safety features. There’s nothing but your skin between the road and your organs. Protect your body with the right safety gear.

Best Beginner Motorcycles recommends that all new riders start with at least a motorcycle helmet, leather motorcycle gloves, a motorcycle jacket, motorcycle boots, and motorcycle pants. The Motorcycle Legal Foundation recommends the same, but also additional safety gear like body armor, knee guards, and hearing protection. Check out both websites for thorough recommendations when buying motorcycle gear.

7. Buy a motorcycle!

You learned how to ride, found the bike you want, and secured motorcycle financing. You’re ready to grab your safety gear and buy your first motorcycle. So, do it! Enjoy the open road and listen to Laurence Fishburne when he says, “On a motorcycle, you can’t really think about more than where you are. There’s a freedom that comes with that – from stress, worry, sweating the small stuff.”

Why You Should Consider Buying A Used Car

Buying a car is an exciting process, especially if it will be your first time to own a car. When it comes to purchasing a car, there will surely a lot of decision-making. You first want to decide what kind of transportation you need. Is it a car, SUV, or truck, the model, the color, and most importantly the price. This decision can make a big difference in your life over the next several years. Let’s talk more about the advantages of buying a used car.

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We live in a generation where the automobile industry is time-tested and has developed advanced technology and quality. Cars today are really good and last a long time. Before we used to think that a car of 100,000 mileage was done, but now cars are running to 200,000 miles.  According to reports, by 2015, the average car driving in USA roads had reached a record of 11.5 years of age. The auto industry experts predict that the number of years will increase by 15% in 2020. But keep in mind that all used cars are not equal. A buyer must do some research before deciding if a used car is in good shape for your transportation needs. Nowadays, you can purchase a three-year-old car and sell it in five years without you needing to do major repairs on it. 

The best thing about buying a used car is that you let someone take the biggest depreciation on the car. This means that you may be able to sell the car for nearly the same amount you paid for it in the next couple of years. And for that, you can still find good financing options because you are not losing the money on depreciation. Another good thing is the insurance rates may be lower on a used car. This may be a significant saving especially for your owners who are paying high insurance rates because of their age. 

There is also a thing called the Certified Pre-Owned (CPO) program offered by the carmakers to make a used-car purchase much less worrisome. CPO enables certified vehicles to get some level of warranty and perks like roadside assistance or a free loan car when your vehicle needs to stay in the shop.  CPO programs vary from manufacturer to manufacturer, but what is important is that these vehicles meet a manufacturer’s established standards. 

If you don’t know much about cars, then asking for a mechanic to look over the car would be an excellent idea.  You should also take a look at the Vehicle History Report to get important information about the car’s past. Shopping for a used car is definitely more affordable than going for the new one. But no matter what you decide, you should do your research and make sure that the car model has been performing well. Yes, there will always be a risk on buying a used car that’s why you need to do your homework before driving home one. 

Author – Edward Cruz is a staff writer for VIPpromocodes.com, a website that provides the latest promotional codes, exclusive sales and offers for all of the top stores in the U.S.

When to get an Auto Refinance Loan

You have no doubt heard of auto loan refinancing before. Or simply an auto refinance loan. The term “refinance” actually refers to a financial situation wherein a borrower finds financing to pay off an existing car loan.  Refinance loans are most often used in home buying.  In fact, refinancing is one of the most popular methods of getting less expensive financing for a home loan.  The reason is that rates change and when you can refinance and save money, it’s a smart thing to do.  This applies to auto refinancing as well.

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With auto refinance, many borrowers have gotten a long at the dealership.  Time passes and rates change and the possibility of saving thousands of dollars may exist.  Auto refinance is basically paying off one loan with a new loan.  The goal of auto refinance is to allow the borrower to save by reducing the monthly loan obligations.  And as such, it is one of the best kept secrets in the financing industry that is so easy to obtain a free look and comparison of your current loan amount.   For years now, people have refinancing their homes and saving thousands of dollars.  

However, the practice of refinancing car loans has not been publicized or communicated as much.  Why?  Perhaps the reason is that auto loans generally behave differently from home loans and people are naturally skeptical about new methods of financing.  Regardless, auto refinance is still a good choice, provided that you do a bit of checking out options.  One option is to use a site that actually give you a choice between different loan offers.  A site that shows you in a secure and confidential manner what other lenders would be willing to refinance your existing car loan for.  A site like myAutoloan.com.

Auto Refinance Loan

If you obtained your auto loan from the dealership, chances are that you can save money by looking at a refinance loan.  Interest rates fluctuate all that time and knowing that the dealer may have marked the APR a bit means that you might save by reducing the APR terms of the loan.  Auto Lending Rates and Mortgage rates tend to move with interest rates.  Therefore, as interest rates change so do the refinancing rates change.  Changing finance rates typically mean all financing rates change as well and thus there is the opportunity to save with a reduced monthly payment.  To check out how monthly rates can change use a rate calculator to get an idea of monthly payments with a new rate. 

Only few people really understand the time value of money.  Keep in mind that the longer you pay for a loan, the bigger amount of money you actually spend for it.  Thus, by the end of the loan period, you could have paid more money on interest than on the principal.  This is why auto refinance is important as it is one of the few methods that could help you minimize loan costs and maximize your savings.

Who can benefit from Auto Refinance?

Almost anyone with a loan to his name can benefit from auto refinance.  Even car buyers with bad credit can obtain auto refinance as a way for them to lower the overall costs of a car loan. 

Let’s say, for instance, you make an auto loan for $16,500 on a new Honda Accord.  You don’t have very good credit because of a few rough roads in your journey.  It happens – something bad things happen to good people.  You decide to move forward and buy the car and you agree to make payments with an interest rate of 21% APR.  Now you make on time payments for 4 to 6 months and your credit score improves and you look into getting an auto refinance loan.    

If for example, you move forward and apply at myAutoloan.com and get up to 4 offers from credible lenders.  Because your payments have been on time your ability and qualifications are attractive to the lenders, the offers vary in rate and payments.  However, this time, you decide to accept a loan rate of 6% APR.  Your current monthly payment is $446 which gives you total interest charges of $10,283 at the end of your loan period. Your auto refinance loan offers you a monthly payment of $319 with total interest charges of $2,639. Thus, by refinancing, you can save up to $7,600.

Whether you have bad or perfect credit the possibility of you saving money with a refinance auto loan is real.  Check out your costs and look into a no obligation auto refinance loan today.  Good luck and good hunting!

How to Find Bad Credit Motorcycle Loans

If your credit score falls between 350 and 650, you might have “bad” credit. But that shouldn’t stop you from getting the transportation you want and need. Learn how to find a bad credit motorcycle loan, with myAutoloan.

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1. Double check your credit.

You might think you have “bad” credit when you really don’t! Or, your credit history could contain inaccurate information that’s bringing down your score. Double check your credit score to make sure you know what you’re dealing with. Try one of our partners, FreeScore360.com or FreeScoreConnect, to get your free credit score from all three bureaus.

If you’re only a few points away from hitting 700, you might want to wait and improve your score so you can secure better loan terms. You can’t always wait when it comes to having transportation, though. You can still get motorcycle loan with bad credit—it just might take some extra work.

2. Save up for a larger down payment.

The more money you can pay up front, the less money you’ll need to borrow and the more likely it is that you’ll be approved for financing. Lenders will view you as less risky and you might be able to secure a lower interest rate for your loan. A bigger down payment can help lower your monthly payment and total amount paid, too.

3. Find a co-signer.

Getting a co-signer is one of the best ways to help secure a car loan with little to no credit, and the same can be said for a motorcycle loan. A co-signer reduces risk for the lender. If you aren’t able to make your loan payments for any reason, the cosigner is expected to do so. Co-signers are additional assurance that the loan will be repaid. A co-signer can be a friend, spouse, parent, or other family member. Keep in mind that there are some situations where you don’t want someone to cosign a loan with you.

4. Persuade with proof.

Maybe your credit score took a hit when you were laid off and had unexpected medical expenses. You recovered and found a new job, but your credit score hasn’t bounced back yet. Explain your situation to the lender. If you’ve had loans in the past that you’ve paid off, bring that paperwork to the table. Provide proof of current employment, regular bill payments, and anything else that could show a lender you’re equipped to make on-time payments on a motorcycle loan.

Here are some ideas for documents that might help your case:

  • Tax returns
  • Bank statements
  • Pay stub, W-2, or other proof of income
  • Recommendation letter from landlord

5. Apply for a loan with the right lender.

How do you know if it’s “the right” lender? Not all lenders will work with people who have bad credit, which is one reason it’s important to check your credit before applying. There’s no use in applying for a motorcycle loan with a company that only provides financing to people with 700+ credit scores, or with one that only offers car loans. Applying in the right places will save you time, frustration, and a whole bunch of hard credit checks on your credit report.
myAutoloan is one of those “right” places. That’s why BadCredit.org ranks us number one on their list of Best Bad-Credit Motorcycle Loans for 2019. Here’s what they had to say:

Since it’s a lending network, you can receive multiple loan offers from a single application, making it easy to compare rates without having to apply with multiple lenders on your own.

See? Bad credit motorcycle financing is possible, especially with myAutoloan. We work to help everyone find the financing they need, including people with bad credit.