Buying a New Car? 4 Extra Costs You Should Know About


The manufacturer’s suggested retail price (MSRP) is just one of the costs associated with buying a new vehicle. When you’re ready to close the deal on your new car, make sure you’re not surprised by these additional costs that make up part of your final price tag.

Car Sales Taxes and Tags

As with any purchase, there may be a state sales tax charge added to your new vehicle purchase (and in some states if there’s no state sales tax, there may be a county or city tax). DMV.orgpoints out several factors that contribute to the costs associated with taxes and tags, including the following:

  • The county in which the vehicle is registered
  • Vehicle weight
  • Type of license plate
  • Your state of residence  also provides a list of handy tax and tags calculators and charts you can use to determine your costs by state.

Title and Registration Costs

When you purchase a new car, you’ll have to register it and have it titled. The dealership does the legwork here, but, as notes, the charge will be passed on to you in the end—at an average cost of between one and three percent.

Documentation Fees

Consumer Reports explains this as the cost associated with processing documents, and it typically ranges from $150–$300.

Destination Charges

Destination charges are charges incurred to deliver the car to the dealership. As Kelley Blue Book points out, you see where those costs originate every time you see a truck or a train carting around a load of new cars. No matter where you live in relation to the manufacturing plant, you’ll pay the same price as everyone else does for that model vehicle, because vehicle manufacturers equalize these costs so every buyer pays the same amount—typically somewhere around $400-$800.

If you have questions regarding additional costs associated with your new vehicle purchase, ask the experts at your dealership.

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  1. 1
    Art Pennanen

    I find no reference auto insurance on this site. What is the minimum insurance coverage required by Ally in NH for a financed auto purchase. My wife and I are currently purchasing or Chevy Cobalt with Ally financing. Our current auto insurance policy is ending soon and we are shopping for new insurance at less cost. We had a recent change in our life style with few assets remaining.

    • 2
      Ally Auto

      Hi Art, thanks for your question. A vehicle financed through your dealer and Ally is required to have comprehensive and collision coverage, and a deductible no higher than $1,000. Please let us know if you have any additional questions.

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