A whopping 41 million second-hand cars and trucks are sold every year in the US. They’re purchased online and in-person all over the country, mostly from private sellers and dealerships. However, in an age of rampant economic uncertainty, another classic source of used vehicles has begun to boom in popularity:
Car auctions! That’s right, buying a car from a car auction is fast becoming a go-to option for buyers on the hunt for a budget ride. Whether it’s government or public in nature, these auctions are being frequented by more newbies than ever before.
Are you thinking of doing the same thing but want some tried-and-tested advice on how to buy a car from an auction before you start? Well, we’ve got you covered. Watch the video below to learn more about reasons why you should buy from online car auctions. Keep reading for 6 key considerations to help you avoid potential pitfalls and drive away with a quality set of second-hand wheels.
1. Risk Tolerance
Car auctions tend to go one of two ways: you either end up with a total bargain or a complete banger! Remember, you’re buying these vehicles as-is and without a test drive, which makes buying a car from a car auction risky (especially when you’re on a tight budget). Sometimes it’ll pay off; other times it won’t.
Of course, knowing what to look for in the auction room will improve your chances of a happy outcome. But there are never any guarantees or second chances.
That’s why it’s so important to appreciate the risks involved beforehand and accept the fact you might buy a dud. If you’re unwilling to do so or lack the financial means to sink the cost, then consider buying a used vehicle through other sources (such as reputable online car buying sites).
2. Mechanical Insight and Expertise
It’s worth reflecting on your levels of mechanical expertise for those same reasons. Imagine bidding for a truck that turned into nothing but trouble when you got it home! Having the time, tools, and skillset to fix it up would be an almighty boon.
Entering an auction with this self-awareness could save you endless hassle down the line. After all, the budget options on the floor might be appealing from a financial perspective. But they only make monetary sense if you have the means to address any mechanical issues that appear.
3. Judging Cars by Covers
Another key tip on how to buy a car from an auction comes down to judging cars on their appearance. The lesson here’s simple: don’t do it! Why?
Because it’s easy to make good-for-nothing vehicles look nice and shiny. Trust us, a healthy dose of pessimism comes in handy at car auctions. If something looks too good to be true, then it probably is.
On a similar note, superficial bumps and scrapes don’t always mean the car hasn’t been looked after by previous owners. This is particularly true at government auctions, where it’s quite common for quality vehicles to have minor aesthetic issues. You do have to be more careful at public auctions, but it’s still worth assessing each vehicle as a whole, rather than on looks alone.
4. Cash Is King
Payment options are somewhat limited when buying a car from a car auction. You’ll need a pre-approved loan or cold hard cash to cover the cost of any bid(s) you win. What’s more, if you take the loan approach, then you’ll still need enough cash to pay the deposit- not to mention the cost of the title, tax, and registration fees.
There are other financial factors to think about too. Different auction houses accept different credit cards, for example, so be sure to qualify what’s taken in advance. You may also have to pay insurance and/or car shipping fees to get the vehicle back to your home.
5. Not All Sellers Are Made Equal
You can often discern a lot about a vehicle from whoever’s selling it. That’s the case whether you’re purchasing from private individuals or from online car buying sites! It’s never truer than when you’re buying cars at auction though.
For instance, government auctions often have old police cruisers on sale. These vehicles may have countless miles on the clock and numerous superficial problems. But they’re from a reputable source, with known histories and accurate records of past maintenance.
Likewise, banks often sell repossessed vehicles at public auctions that were used as collateral on loans. Another reputable source, you can pick up great cars at good prices as a result. By comparison, car dealerships use public auctions to flog inventory they couldn’t sell through standard avenues, which doesn’t fill you with confidence!
6. Limits and Level-Headedness
Bidding wars are real. In the heat of the moment, our natural competitiveness can take over and rationality flies out the window! If you’re not careful, you can end up bidding far more than you wanted to on vehicles that may or may not be worth the money.
Do your best to stay level-headed throughout proceedings. Slow down, take a step back, and ignore any pressure you might feel. Another sensible strategy is to assign yourself an upper price limit each time you bid and refuse to go beyond it.
Oh, and watch out for bidders whose sole intention is to drive up the price. Where possible, you could even attend and observe a few auctions before you participate. This would give you a feel for the process and a better idea of how to conduct yourself.
Good Luck Buying a Car from a Car Auction
Car auctions are nothing new. But they’re now more popular than ever among people who want to buy a new vehicle without overspending. Alas, these auctions can pose a host of potential landmines for anyone new to the process.
Are you thinking about buying a car from a car auction? Well, with any luck, the considerations in this post will help you avoid these possible pitfalls and drive home happy.
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