The Consumer Price Index (CPI) announced January 11, 2019 caused an increase in the maximum documentary fee from $118 to $120 for processing titlework manually and an increase from $141 to $144 for dealers who perform online registrations with an online provider such as Cox/Dealertrack. The increase is effective immediately.
The documentary fee:
· is non-taxable;
· may be excluded from a dealer’s advertised price for the sale of a vehicle;
· is a negotiable item, so the actual dollar amount may not be pre-printed on the buyer’s order;
· is a dealer-imposed charge, not a state-mandated fee; and
· must be disclosed on a sign in the dealership.
Documentary fees are adjusted annually in accordance with the Federal Consumer Price Index.
Dealership’s documentary fees cannot exceed the permissible charge or the Attorney General’s office may consider it to be deceptive as to what services are being performed and may find the dealership subject to enforcement action.
Online Dealer Fees Clarified
Prior to 2009, when the Documentary Fee was statutorily provided for in the law, dealers performing online registration had three separate fees itemized on their buyer’s order.
1. The documentary fee
2. The online registration fee, and
3. The online dealer fee (in addition to other applicable fees).
The online registration fee is the actual fee charged by the provider (i.e. Cox/Dealertrack) for services and can be passed on to the customer. However, the fee cannot be marked up.
Prior to 2009, the online dealer fee was a market driven fee for the dealership’s processing of the online transaction. When the documentary fee was provided for in the law, dealers who perform online registrations were able to charge the higher documentary fee amount, which encompasses the online dealer fee. Dealers should no longer itemize and charge an “Online Dealer Fee.”
If a messenger service is used to process the titlework, a Messenger Fee can be charged. It must be the actual amount charged by the messenger service. It cannot be marked up. It must be passed directly through to the customer and must be separately itemized.
Occasionally, financial institutions will require a dealership to submit proof in writing of the documentary fee increase. The state franchise law permitting an annual adjustment based on the CPI can be found a www.paa.org/legislative. Or information is available through the Department of State at: www.dos.pa.gov/ProfessionalLicensing/BoardsCommissions. For calculation information, contact Melanie Stine at [email protected].
Please update the information posted in your dealership as needed.