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OMVIC Blog: Car Buying Tips

Dealer Fees are Not Illegal …but they must be included in the advertised price!

Aug 24

Written by: OMVIC Communications
Friday, August 24, 2018  RssIcon

Dealer fees

 

Recently a consumer wrote to OMVIC:

“We recently purchased a used vehicle from an OMVIC Registered Dealer. We were charged an administrative fee of $199. We questioned this and were given a vague answer; the salesman insinuated this was a normal charge. I thought dealers couldn’t add fees.”

 

There can be some confusion when it comes to All-in Price Advertising. So let's clarify:

 

1) Dealers absolutely can charge fees. There’s going to be a freight fee on a new vehicle, and many dealers charge administration fees. Dealers may also charge fees for products or services they’ve pre-installed on the car. There’s nothing inherently wrong with that. 2) All fees with the exception of HST and licensing must be included in a dealer’s advertised price. 3) All fees must be itemized separately on a bill of sale. So, dealer fees are NOT illegal: not including all fees in an advertised price IS illegal.

Bottom line: Dealer fees are not in and of themselves illegal at all. Most dealers charge fees. They have to be included in the advertised price and they have to be itemized separately on the Bill of Sale.
It’s important that consumers understand that distinction.

Advertisement 21888

Bill of Sale


In the example above, the dealer is charging $20,000 for the vehicle and has additional fees that make the price $21,888. What the dealer is charging is entirely legal because the dealer advertised the car for $21, 888. If the dealer had advertised the price for $20,000 and then tried to add the fees, that is illegal and breaches the All-in Price Advertising Regulations.

To learn more about all-in price advertising click here

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