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How to Buy a Used Car at an Auction (Part 2) & Save a Few Thousand Dollars Possibly

In Part 1 of this series, we examined the reasons why a wholesale used car auction is well worth your time and attention.

Today in Part 2, we’re going to look at what actually happens at an auction, so that you can look like a seasoned pro – even if it’s your first time.

Speaking of which…

Try to Go to a Few “Practice Auctions” First

The best way to get a feel for an auto auction is to attend one. Of course, if you only go to one and buy something there, you could find yourself making an expensive mistake.

Top Tips While You are At the Car Auction

 Tips While You Are At the Car Auction
1Go to a couple of auctions for practice and how bidding goes.
2Find an auction that sells newer cars.
3Check inventory listing and pick a the vehicle you want to bid on.
4Check out the vehicles & fluids at the auction house.
5Do your due diligence on vehicles you want.
6Establish your price for what you’re willing to pay.
7Watch the crowd in the bidding process before your vehicle comes up for sale.
8Stick to your guns on your price.
9Get inspection if available.

That’s why, before you go to buy, you should go to a couple of auctions just to watch.

This will let you know exactly what to expect when it’s time for the real thing – potentially saving you tons of money, or helping you to snag the car of your dreams.

Ferrari Classic car at Auction

It is possible to get an exotic car for a decent price at an auction. Image Credit: Nils Rohwer, Creative Commons license.

Get There Early & Get Mentally Prepared

When you arrive at the auction, you’ll likely have to register at the front counter. Many auctions require your license and a small deposit (around $100) up front.

While you’re there, take the time to grill the auction representative about the process. Most importantly, find out in advance what the buyer’s fees will be.

These vary from auction to auction – and some can be quite hefty. If you don’t account for these fees ahead of time, you could easily find yourself blowing your budget.

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If you already know which cars you’ll be interested in ahead of time (and you should), then take the time before the auction to inspect them.

Get a feel for the car and how it sounds when you start it up before you actually bid on it – this can keep you from plopping money down on a lemon.

Also, look over any Carfax information, or any other info about the car that

used car salesman

Going to an auction you can avoid the hassles of a “used car salesperson”. Image credit: neontommy.com Creative Commons.

the seller will provide. The more research you do, the better chance you have of getting a good car at a great price.

Know Your Lights Before Bidding

Many auction blocks have four lights: red, yellow, green, and blue.

Pay attention to these, because they all say something different – and important – about the car being sold.

Red Light – this means the car is being sold “as is.” If there’s any issue with the car – mechanical problems or missing pieces – then you assume responsibility for them if you have the winning bid.

This also means that, if you didn’t do your homework, you’ll have no idea if there’s anything wrong with the car beforehand.

Yellow Light – this means that the car has an issue, and the auctioneer will announce what it is before bidding starts.

Green Light – if you win this auction, you’re given 1-3 hours to drive and inspect the car.

Typically, this only covers major issues like engine or transmission problems, and not relatively minor things like leaks or faulty air conditioning.

Blue Light – this means that the title for the car has yet to arrive. If you win a blue light auction, then your check won’t be cashed until the title arrives.

If it doesn’t arrive within 30 days, you get to return the car and get your money back. Of course, you can’t register the car until you get the title.

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Conclusion

Beyond that, an auto auction is like just about any other auction. Just check with the auction company beforehand for any special rules and regulations (and make absolutely sure you learn what constitutes a bid).

Coming up in Part 3, we’ll go over some tips to make sure you get the best deal possible.

Greg Fowler
I love to network, travel, and spend time with my children. When I am not doing that I am working on AutoInsureSavings or other websites. If I am working, the best way to reach me is via my Google+ Profile.

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