The offers usually made at automobile auctions are oftentimes irresistible. You may have heard of a repo auction where one can get a car at 10% its original value. But you think to yourself, there has to be a catch! Why else would anyone sell a car at that price?
The answer lies in something really simple. A repossessed car is one that has been seized, for instance by a money lending institution, from a defaulter in order to make up for the lost cash. Therefore, if such an institution holds a repo auction, the amount it requires from bidders may be a small fraction of the vehicle’s cost – their aim is to get back what they lost when the borrower defaulted and cover incurred expenses (towing etc).
Government auctions, on the other hand, may be held to dispose of vehicles that are no longer in use by some state department. It may also auction off surplus vehicles. Depending on the condition and age of the vehicle therefore, you may get it at a really low price at such an auction.
Salvage car auctions are popular with insurers and may involve the sale of damaged vehicle wrecks or even after carrying out repairs.
All you need to do before you buy such a car is to check its history. This will help you confirm whether it is stolen and if claims made about its condition are actually consistent with its history.
With the amazing offers available at such auctions, it may be sad if one is held in a location close to you and you hear nothing about it. But that is what happens in most cases, unless you know exactly where to look.
