Buying an auction car is something I know a lot about and I would like to share some insight with visitors. My experience is based on working for one of the largest auto auctions in the U.S. as well as attending many automotive only sales as a buyers agent. The process can be intoxicating and overwhelming.
The real opportunity to save thousands of dollars over retail is genuine and tangible. My function at the car auction was to perform frame inspections and prepare the individual vehicles for sale day. My department was the certified mechanical reconditioning center for the facility. We evaluated automobiles and sometimes boats to determine the overall condition. It's this condition that would determine how the individual unit would be auctioned. The places I went to and worked for divided the stock into three main categories.
Green light meant the vehicle was in good condition and that no major system problems where detected. The auction company would warranty a green light automobile for 30 days and provide a refund to the buyer if major problems where discover after the sale.
The next designation was the "yellow light cars". This is when minor problems are detected on a full inspection. A couple examples would be if the AC was not blowing cold air or maybe a dash warning lamp was on like a check engine light. Problems that did not directly affect the power train system would also be included.
The last classification was the red light vehicle. This meant that a major power train component had been identified as having a problem. Example of this would be a worn engine that smoked or a transmission that slipped.
The red light vehicle was sold in "as is condition" with no warranties implied. The red light vehicles attracted auto mechanics looking to invest time and money into repairing them. The goal was to send it back through under a green light condition for top dollars.
The excitement on auction day was the real opportunity to buy a vehicle thousands below market value. You could bid unchallenged on a vehicle and walk away with one hell of a deal.
The auction could also go the other way and you could get into bidding war that would leave you with little or no profit margin. The auction car used inventory was supplied from many different vendors but was mainly from different leasing and rental car companies. When turned in at the end of contract it was shipped to an auction car operation.
Also the large rental car fleets would dispose of their aging inventory at these locations. Some of the vehicles where very well maintained and some not. The buying process would best be described as the buyer must beware and very well educated on the subject.
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Learn more about this subject and what its like to work in this field of the car business from one of my real life
automotive auction stories.
This next auto auction story is about a mechanic that worked under me and what can happen when a car auction mechanic turns bad.
After working at and helping people buy at the sales you can't help but pick up some valuable insider information. Here is a few things to look out for like snipers and shills as well as a few more auction tips.
See more about this website on the auto facts.org homepage.
Buying an online auction car is a different animal. The online sites deal mostly with government or seized vehicles and also bank repositions. The opportunity to save money is even greater in my opinion than the land based auctions.
The government vehicles have very low reserves and can be sold a lot cheaper then the full blown retail price in some cases. If you can get one of these deals the condition of the vehicle is not as important due to the fact you got the car so cheep.
As long as the vehicle doesn't have
frame damage you can fix it up and still have a total investment below
the blue book value. If the price creeps up to about 50% of retail value
then you should start considering protecting your investment. For more
information on this see my page about how to
buy a used car online.
If Buying a car online scares you a little you can always use the internet just for research. Now as far as where to go for an auction car online lets talk about this a little further. The best way to go in my opinion is with an auction database type service.
This service provides one stop shopping for a complete database of ongoing auctions. Hunting these down you're self would take a lot of effort. Each state and county have their own auctions and the data base service ties all these together. One of these is government-auction.com they have a large database, both online and local.
Details of how it works are below but they offer a 56-day money back guarantee if you just want to jump in. On the site you can get almost any make or model vehicle you desire. Including retired police cars. See my article on why I love police cars and how they can be a best buy for solid transportation. Visit my insiders guide to buying a police car.
Governmentauctions.org has created an large database full of these auction opportunities, giving you the chance to bid on many items for up to 90% off their retail value. Once you have purchased your V.I.P Membership you will have Unlimited access to the entire site and all it has to offer.
Who is Eligible? Everyone is eligible to take part in these online auctions! They are easy to use and fun! They have designed the site so that you can find what you are looking for Quickly! Whatever you are searching for they probably have it in their database!
What is a Reserve? A
"Reserve" is a set price that the seller is allowed to make. If no
bidders reach this set price, Reserve, than the item will not be sold.
This is the absolute lowest price that the seller is willing to sell
for. Many think bidding is the easy part! When you do a
search you can go through the results and choose your preferred auction
site. Once you have done this registration goes pretty quick. Once regestered you are asigned a customer number used to track the bids.