I agreed with my dealer for $X over invoice (a very good deal in my area). When it came to the payment, besides the licensing fees and tax, I was also asked to pay $35 of document fee (even though I was paying all in cash so there was no financing paperwork involved). At that time it didn't occur to me the fee was avoidable and I thought it was associated with the car licensing that the dealer is doing. It was a small sum of money so I don't think the dealer did it intentionally to generate more profit (as it happens in case of advertisement fees). I also didn't want to appear as a jerk to argue about this. However, from a few posts on this forum, it seems that some people don't pay the document fee because "the dealer shouldn't charge for selling you a car".

So, what is your opinion on this? Does the dealer always ask for this fee? What exactly does it cover and do you pay it when you have a deal of X over invoice?