Simple Rules for Buying Cars at Auction

by Don Elliott on August 1, 2012

Buying a car or truck at an auto auction can be a fun and rewarding experience. Whether you are bidding at a public auction, a government auction, an estate sale, a wholesale auto auction, a salvage auction or even at a collector car auction, a few basic rules apply. By sticking to these simple rules, you can get the most out of your auction experience.

Rule #1 – Make your payment arrangements before arriving on auction sale day. Auctions only accept cash or, in some cases, a credit card. Payment is required immediately after the car auction concludes. The auctioneer’s chant, the ringman, and the movement of the car across the auction block are all designed to get the most money from the bidders and to encourage the seller to let the car go for a little less. Don’t get caught up in the enthusiasm of the bidding and pay more than you can afford.

Rule #2 – Arrive at the auction early to inspect the cars on your list of possible purchases. So may times I have seen bidders pay too much for a car that has problems. When permitted, prior inspection before the auction prevents buying somebody else’s problem. If you have limited knowledge of how cars work, take a friend to help you inspect the cars before the bidding starts. If you are the successful bidder, you will own the car and all the problems that come with it. Be sure to include repairs in your budget when you figure out your top bid price.

Rule #3 – Listen and learn the auctioneer’s chant. Each auctioneer has a different “song” that is their trademark banter. Some are easier to understand than others. Make sure that you clearly understand the bidding sequence before putting your hand into the air. The auctioneer will usually start asking for bids at a high amount and go down until someone opens the bidding. Bid increments can be large at the beginning of the bidding exchange, as much as $1000-$5000 on expensive cars. As the bidders drop out, the increments tend to go down to the $50-100 range on less expensive cars.

Rule #4 – Watch other potential bidders as they inspect your car before the bidding and as the car approaches the auction block. Often another person will notice something that you might have missed. If another potential bidder spends a considerable amount of time with the car that interests you, he or she will likely be your competition when the bidding begins. If that person has a long list of potential cars, it is possible to assume that they will get off the car early giving you a shot at a good price. If that car is apparently the only one that they are interested in, be prepared for some active bidding that might push the car beyond your budget. No matter how bad that you want the car, stop bidding when you are out of money!

Rule #5 – Consider all the costs when you make your auction purchase budget – In addition to your successful bid, you will also need to pay the auction’s buyer fee. The auto auction will provide a fee breakdown, but you will have to ask for it before the auction action begins. Just like buying a car from a car dealer, you will have to pay taxes and title fees to the state. Almost every car purchased at the auction will need some repairs. Car dealers make repairs to the cars that they buy at auction before you buy them at the dealership. On the other hand, auction cars are, for the most part, as is. They will need tires, brakes, fluid changes including oil and filter, and wiper blades. On many occasions, they will need a good cleaning. A professional auto detailer will charge $125 or more to make an auction car look like the cars on the retail car dealer’s front line.

In general, plan ahead if you intend to buy an auction car. By doing your homework before the auction sale begins, it is possible to find some great used car values. Ask questions. Let the auctioneer know if you are not sure where you are in the bidding. And most important, don’t pay more than you can afford!

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