Tuesday, October 25, 2011
10 Tips On Buy From An Auto Auction
We’ve done it. I went and bought two used car at a Government Auctions website and landed a total bargain – a ten-year-old Honda Accord 2.4 coup for $1200 less than the blue book price, $3000 less than the dealer would ask on the forecourt.
You can do it too if you follow our simple guide.
1. Do your homework
Pay a visit at least once before you put on your buying hat. You'll learn a lot about the way the auction functions, from registering, getting your catalog and, most importantly, how the quickly the actual bidding take place. You'll quickly realize that you could be there for hours with the tension building up, but in just 30 seconds "your" car has entered the hall, been sold and has disappeared out the other side.
2. Pick your auction
The best cars and the biggest choice go through the big auction companies, Government Auctions. They sell thousands of cars a week. At the time of compiling this report, Government Auctions had 10,329 cars for sale at its 19 sites. The smaller independents often concentrate on the cheaper end of the market, but you’ll get those at the two-ring circuses at the bigger auctions too. There are also specialists, like Brightwells of Leominster, who have a weekly sale of 4x4s.
3. Choose your time
Half term weeks, evenings and Saturdays are busy with private buyers, who will force up the prices. Weekdays are much better, because you are less likely to come across an enthusiastic amateur who will pay anything just to get the car you want. Then there is the month. November and December are prime times to buy. Then dealers are buying less stock because they will struggle to sell it much before late January. The last thing a car dealer wants is cars sitting around on the forecourt with no buyers.
4. Decide on the car
Tricky this, because you will undoubtedly see some tempting cars that weren't on your list before you went. But you need to be sure that the model of car you buy is one that really suits. Don't make a passionate but stupid buying decision on the spur of the moment. Next you need to make sure that there are several examples of the car you are after at the auction. Of the five Honda Accord’s we looked at, only one was immaculate. Inevitably it fetched the highest price, but as a private buyer, putting right scuffed bumpers and small dents right can be surprisingly expensive.
5. Check the car over
A visual check is all you'll get, but its enough to sort out the wheat from the chaff. Look for bodywork damage and especially for signs of accident damage. Panels that don't quite line up and paint on the rubber bits is a sure sign of a hard life. Stand by the car as the driver starts it up, listen for alarming rattles and puffs of black smoke.
6. Look like a dealer
You definitely don't want to look like a punter as dealers may take you on for their idea of a bit of fun. Forget the sheepskin jacket – we didn't see one – but no one dresses smartly either.
7. Stand in the trough
Keep out of the stand seats – only private buyers go there. Put your partner up there and stand down on the floor with the real men. Catch the auctioneer's eye by holding up your catalog for your first bid. Then all you need to do is give him a nod when he looks to you for another bid. If the bids are going up in $100 steps, but seem to be fading, hold your catalog across your chest to put it up by $50. I did it by mistake, but it saved me the price of a good dinner at the end of the day.
8. Stick to your guns
The good thing about an auction is that, if you really, really want a particular car, you'll get it. All you have to do is keep on bidding until everyone else drops out. It's a daft approach though. Be prepared to come back another day rather than bidding more than the car is worth or you can afford. And for heavens sake don't let your partner bid too – it nearly happened to me!
9. The Buyers Premium
The auctioneer may charge you a buyers premium of as much as 3% of the hammer price when you come to settle up. It's not a rip off, because some auctions will provide in that premium a warranty that the car is legitimate, IE not stolen, under finance or repaired after a serious accident. It saves you the cost on an HPI check, at least. After you have settled up you can take the car away immediately. A bank debit card (never a credit card) is the best bet – warn your bank to expect a large cash withdrawal beforehand if you don't want to wait around while telephone calls are made. Cash will do nicely too, although there may be a maximum the auction will accept (for BCA its $9,000) due to money laundering rules.
10. Finally, remember there is no comeback
No guarantee, no room for complaint if things don't work, no money back. Well, hardly any. The best you can hope for is an hour to complain after the sale is closed. Auctions are aimed primarily at dealers who are prepared to take the risk. You are in the same boat, and thats why you can save a fortune.
This was the website I went to and used the tips I provided.