Pursuant to the California law car dealers have the right to add a document fee of $55 to each auto purchase contract. Taking into consideration that the preparation of documents is the part of the dealer’s business, the law should not allow the dealers to charge extra money for this. However, this year car dealers decided to sponsor a bill in the California Legislature and raise the cost of this service from $55 up to $65. This will cost California consumers an approximate $40 million every year.
The bill was passed by the Assembly, but this week the author of the bill withdrew the bill in the face of opposition from key senators, including Senator Ellen Corbett, who chairs the Senate Judiciary Committee. Opposition to the bill was led by Rosemary Shahan, the head of the consumer advocacy group, Cars for Auto Reliability & Safety. Now California car buyers will be able to save about $40 million per year.
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