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Are you in the market for a used car in excellent condition selling for a low price? You may want to consider buying your next car from a repo car auction.
Thousands of cars nationwide are repossessed every day and sold through government auctions. The opening bid for these cars is typically set to whatever is required to satisfy whatever liens may exist against them. So if you find a car that is worth $15,000 being sold at an auction with an opening bid of $5,000, that usually means that there exist $5,000 worth of loans and other fines or fees against the car.
Why buy a car from an auction instead from a dealer or a private seller? Both dealers and private sellers are looking to make some money off of their cars and may try to sell their cars at their respective blue book value.
A government-sponsored vehicle auction, on the other hand, operates irrespective of the blue book value and is typically a not-for-profit endeavor. The objective at an auction is to unload cars that are otherwise abandoned.
What good is a car if it has no driver?
One caveat, though: Just because a car is at an auction does not automatically make it a great bargain. What if the car is in need of serious repairs? The cost of these repairs could easily offset the bargain price you just paid for the car. Or what if the previous owner of the car was upside down on the loan? It is for this reason that you must do your “homework” before you bid for a vehicle at an auction, to make sure that you truly are getting a bargain for it, irrespective of whether you are buying it to keep or buying it to fix it up and resell it.