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  • Nicholas Hinrichsen

How to calculate your vehicle's out-the-door price

Updated: Aug 13

When you go to buy a car today, you will find that your out-the-door price far exceeds the advertised price. We find that usually tax, title and the additional fees confuse buyers, especially if it's their first car purchase.


We are not referring to bait-and-switch techniques, though. Tax, title and additional fees apply to every car you purchase and these fees result in a big difference between the advertised price on listing pages such as www.autotrader.com, www.cargurus.com and www.cars.com and the price you will end up paying when leaving the dealership.


Table of contents

  1. What is the out-the-door price for a vehicle?

  2. Let's break down your out-the-door price

  3. So, what do I actually pay for my car?

  4. How to lower the out-the-door price of your car

  5. How to refinance your auto loan and save thousands of dollars

What is the out-the-door price for a vehicle?


The dollar value on your purchase contract will be different from the price you saw the vehicle listed for – sometimes wildly so! No dealership advertises their out-the-door price, because even the dealer can’t say for certain how much will be added on until he gets some of your personal details:


  1. Sales tax for example varies from state to state, and even from county to county and the dealer will charge you the rate that applies to your home / registration address.

  2. Title and registration fees, in contrast, tend to be much more specific to the car you're buying. In fact, in some cases, registration fees can depend on whether and when the previous owner of the used car you're looking at last paid her registration fees.

  3. Additional feels include a line item called 'doc fees'. If you're asking yourself 'What the hell are doc fees?' – we’ve got a detailed article breaking it down for you!


In sum, a dealer can’t tell you your exact out-the-door price off the bat; it’s specific to where you are, what you are buying, and sometimes even on the previous owner in the case of a used vehicle. That’s quite annoying, we know, but it’s just part of the car buying experience.


Unless you're fine with an estimated out-the-door price, which is almost guaranteed to change, you’ll need to cut the dealer some slack and patiently answer some of his questions.


Let's break down your out-the-door price


So, let’s say that you want to buy a brand new, fully loaded Nissan Altima – good choice!


You browse through the typical listing pages including www.autotrader.com, www.cargurus.com and www.cars.com and find a car you like. You’ve been looking at it for a while, and recently seen it listed for as much as $30,200. You’ve waited long enough, and it’s now gone down from an excessive high to a price you feel good about and can afford at $27,713.

The lower the dealer drops the price, the more excited you get about the vehicle. That’s true for everyone else out there looking for a good deal though. If a dealer lowers the price of a popular car, like an Altima, then more people will open the vehicle detail page and the dealer will immediately see the increase in demand. So in order to not miss your opportunity, you decide to swoop in at the $27,713 price.


Sadly, there’s no way you are only paying this price and this price alone. When you arrive at the dealership to go for the test drive, the 'hard work' begins. The sales person will bring you to the Finance Manager to talk over finalizing your purchase. This means listening to the sales pitch on things like extended warranty, GAP insurance, and other protection products. You’ve decided to go with it – it seemed like a good deal, so why not?


So, what do I actually pay for my car?


Now, those costs will be added to the cost of your vehicle. Then, they add on the extras we spoke about – doc fee, title and sales tax. The final price you pay is around a whopping $32,395!

Take a look at our graph above, and you can see just how that extra cost came to be. It shows you how you managed to add on the best part of $5,500 to the price, adding so much more to the ‘bargain’ you had previously seen.


How to lower the out-the-door price of your car


Sadly, the above mentioned fees are part of the car buying process. The part that frustrates us most, however, is how dealers communicate them: in our recent study 'Lower your rate now. The car loan market is inefficient' we found that 79% of car buyers get their loan at the dealership. If you are one of those car shoppers, dealers will focus their conversations on 'monthly payments', e.g.:

  • 'Protection is important to you, right? Let's add an extended warranty to your purchase. It's just $28 per month!'

  • 'Are you worried that you'll be financially impacted in case of a total loss or theft? Let's add GAP insurance. It's just $9 per month!'

  • 'I'm sorry you're surprised about the doc fee, every dealer charges it. The good news: it's just $13 per month!'


See what the dealer did there? He made you feel good about buying the high margin protection products and not pushing back on the doc fee by spreading the dollar mounts over your e.g. 72 months loan term. When divided by enough months, all these fees and product costs feel small.


In our study 'How much car dealers make, how to get thousands back', we found that dealerships make most of their money through selling financing and protection plans. To say it bluntly: dealers sell cars in order to create an opportunity to sell the much higher margin products, such as financing and protection plans. Therefore, the above described dealer behavior doesn't surprise us.


There is really good news though! Most car shoppers don't realize they can request refunds for the protection products they bought and aren't using. Once you requested a refund for these products, your loan balance decreases. When your loan balance decreases, you may qualify for a lower rate and can further reduce your monthly payment.


How to refinance your auto loan and save thousands of dollars


It's like a double-whammy! So why wait any longer? Let us help you review your protection products and explore if you qualify for refinancing.

WithClutch.com is a fully digital platform that lets car owners like you do so from the comfort of their own home. No need to set a foot in a bank or credit union. You can lower your rate or get cash in as little as 20 seconds.


Follow three simple steps to refinance your auto loan, get approved in seconds and save thousands in minutes.


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