5 Irksome Car Fees
Which vehicle-related add-on do we hate the most? Car-rental insurance.
When you’re at the car-rental counter, you can count on getting the hard sell for a collision damage waiver. It covers damage to the car and typically costs $20 to $30 a day. You probably don’t need it. Rental-car damage and liability are covered by your auto policy up to the same limits as for your personal vehicle, and most credit cards will pick up your deductible and miscellaneous fees (but you have to use the same card for the reservation as well as the payment).
But turning down the CDW isn’t always a slam-dunk. You may want to buy it because you don’t want a rental-car accident reported to your auto insurer, or because you have dropped collision and comprehensive coverage from your policy and you aren’t using a credit card that’ll pick up the bill. If you don’t have auto insurance, your credit card will probably cover all the damage to a rental car, but credit cards do not provide liability coverage. You can buy supplemental liability or additional liability insurance for about $13 a day.
No-show fee. If you make a reservation for a rental car, be prepared to show up or pay up. Many companies allow last-minute cancellations without a fee, but if you prepaid to lower your rate, watch out. With Avis, Budget and Hertz, for example, if you don’t cancel within 24 hours of your rental, you’re charged a $50 fee. Hertz charges $25 for any cancellation up to the 24-hour window. Prepaid rentals through Priceline and Hotwire are nonrefundable and can’t be changed, either. Avoid prepaid rentals unless you know there’s no chance you will want to back out.
Airport concession fee. You’ll pay extra for the convenience of renting a car at the airport. Airports charge rental companies money to have a location on site, which they pass along to you -- typically 11% to 13% of your total rental rate. Compare rental rates at off-airport locations (at a travel site such as www.kayak.com), and if a cab ride into town won’t eat up all your savings or too much of your vacation time, go for it.
New-car dealer fees. When you buy a car, dealers often add fees to boost their bottom line. To preserve yours, check the contract for vehicle- or dealer-preparation fees (for cleaning, removing plastic and checking fluids), floor-plan fees (the cost to hold inventory at the dealership), advertising fees, and administrative fees. Ask to see the factory invoice sheet. If the fees are listed there, pay them -- they come directly from the manufacturer and the dealer has to cover them. If they’re not listed, ask to have them removed. No dice? Buy from another dealer.
Document fee. Another way dealers pad a new-car price is with an inflated “doc fee.” The fee itself is legit and covers the dealership’s cost of processing the paperwork of your sale. But some dealers charge up to a few hundred bucks. Find out if your state limits the doc fee on your Department of Motor Vehicles Web site. If it isn’t regulated, check to see what other dealers in your area are charging and negotiate.