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The Truth Behind Making Money at Police and Public Car Auctions
22nd February 2011
I’ve bought and sold over 500 vehicles at various car auctions since 2002. Police auctions, Bank-repo auctions and State & Local Government auctions are all fantastic places to buy cars at wholesale prices. Like anything, however, not every car at these auctions is a winner waiting to be purchased for pennies on the dollar. Finding the best deals at the best auctions takes a little research. But, the fact remains, you’ll never find a better deal on a used car anywhere else.
Why are Auctions such a great place to purchase a car?
The biggest reason, of course, is the price. It is very common to get vehicles for 50% below retail. Especially, given the state of the economy, people want to buy reliable, fuel-efficient cars at great prices. If you can do the leg-work to acquire these cars at auctions…you can quickly start making a very good income for a few hours of work a month.
The other big draw to car auctions is that there are no dealers to argue with. Used car dealers are notorious for doing anything to sell a car. They have this reputation for a reason. By buying at auctions, you don’t have to worry about haggling over prices or having a salesman follow you all over the car lot.
Despite the obvious advantage of buying at auctions, I’m amazed how many people stay away because they think that the vehicles are in poor condition or that there’s some big ‘secret’ to finding these car auctions.
These are the two biggest and most expensive myths about Car Auctions….
Firstly, are there junky cars at these auctions? Yes. But are there great cars in great condition? Absolutely.
Over the years, I’ve bought many low-mileage seized autos that were in excellent condition. They were seized from a drug-dealer (or whatever type of criminal) by the police and auctioned off to help the local government raise money. I’ve also found a lot of great deals at Bank-repo auctions. Great cars in great condition that were simply repossessed by the bank because the person didn’t make their payments….and I was there to take advantage of a great deal. I’ve bought a lot of higher-end cars from these two types of auctions (especially BMW’s) because criminals tend to drive nice cars and banks repo cars that someone thought they could afford but really couldn’t.
Another great source of what I like to call more ‘functional’ vehicles are government agency auctions. A lot of state & local agencies are constantly buying new vehicles for their fleet and selling off the old ones. Not just police but, environmental agencies, department of transportation, city inspectors, etc. all drive government owned cars. These are traditionally very well taken care of (they’re required to by law) and have relatively low mileage. These make great resales because they’re cheap, reliable cars and people (especially in this economy with these gas prices) are always looking for such cars.
How do you find the good deals at these auctions?
A lot of people are still scared away from auctions because they think they have to be a mechanic to be able to separate the good cars from the “lemons”. I admit, I fell into this group when I started. At almost every auction you can inspect the cars before submitting a bid. While you won’t be able to take them for a test drive, many will still come with a manufacturer’s warranty. I’ve bought a lot of ‘government’ cars without even seeing them because they are always in such good condition. But here’s a quick checklist which I recommend for anyone just starting out – this will help you avoid getting a ‘lemon’:
1. If possible, start the engine and listen for anything unusual (or to see if it starts at all). Note most auction sites will sell these cars “as-is”. If you’re able to get a look at the car while the engine is running, you’ll be able to tell a great deal about in what condition it’s in. Check the exhaust to make sure it’s clean, check the air conditioning, heat and all the power options (windows, seats, sunroof, etc.).
2. Check for water damage under the seats, floor mats or in the trunk.
3. Lift the hood and check the oil. Check for white bubbles on the dipstick (this means there’s likely water in the oil tank) and check for any grains (i.e. sand or sediment). If the oil looks think and pasty it’s likely the car wasn’t regularly maintained. These aren’t necessarily deal breakers but I’d adjust my bid accordingly.
4. Check the transmission fluid too – you’ll want to see that’s it’s clean and not dark or sticky. Look at the tailpipe for excessive soot.
5. Check the exterior as well. This is easy and you’re really just looking for what condition it’s in. Is there rusting? If so how much? Look for paint bubbles or welding marks. Also, keep an eye out for slightly different shades of paint, rough surfaces or body panels out of alignment. Also, make sure and check the engine compartment for new bolts or bolts which don’t match in color.
As you get more comfortable with buying at car auctions you’ll learn what’s a ‘dealbreaker’ and what’s not. As I mentioned, unless a government car looks really bad in the picture, I’ll submit a bid without even looking at it. Even if a car I’ve just bought needs a tuneup, new brake pads or an alignment, I keep that in mind when I’m bidding. If I can make ,000 on a resale, I’m happy to spend another 0-0 to get it into shape. You’re still getting a great deal because of the purchase price.
I would also recommend (especially as you start out) getting a CarFax or AutoCheck vehicle history report. These are cheap ways to get a lot of information on the car you’re interested in.
When I started out, I got an AutoCheck report for every vehicle I was interested in and it gave me more than enough information to make an informed decision.
Even if you DO end up getting a ‘lemon’…i.e. you didn’t get an AutoCheck report and bought it sight unseen and it needs a new transmission that you don’t want to spend the money on? Then you can always sell it at the next auction. Someone will always want to buy it and fix it up…
How do you know what to bid?
Before bidding on any car you should know the “comps” or resale values. Look at Kelly Blue Book, Edmunds.com, the NADguides, the MMR prices (check out our website for more on this) and, of course, ebay motors and autotrader.com. Look for comparable cars with similar mileage and establish a range of prices. The low end of this range is you target bid price.
If the bidding gets too high just walk away…I remember something an experienced auto trader told me at my second auction when I was getting worked up about a BMW I was bidding on. “don’t get to excited kid…In this game, you always have another ‘at bat’ “. What he was saying is: don’t spend too much on a car because there is always another deal out there. I ended up letting that BMW go to someone else but I got another one a week later for several thousand less. I always try to remember that bit of advice.
How do you find these auctions?
A lot of these auctions can be tough to find. Only very recently have they started advertising online but most have had websites up for years. The result is…a simple “Google search” isn’t going to turn up anything.
You can always find some local auctions in the paper which is a good place to start. I’ve spent years compiling a list of these auctions by state which is another good resource to save you a lot of time and money. Check out my site for more.
The bottom line. You can’t afford NOT to look at Car Auctions.
I’ve been amazed at some of the deals I’ve found over the years at these auctions. It’s been enough to surpass my day job and for much less work. Even if you’re interested in just buying one car for yourself, you can’t afford NOT to look at a Car Auction. So what are you waiting for?!
Chris Chamberlain started going to Car Auctions in 2002 in the hopes of getting a good deal on a car for himself. Several years and hundreds are cars later he’s made a small fortune flipping cars. Check out http://www.officialgovernmentgrants.com to learn more on this and his other streams of income.
Article from articlesbase.com
My husband repossessed a car in Texas while the customer was in the store. Can he do that?
2nd February 2011
The customer called the police and the police went to the car lot and made them give her the car back and she made her payment. (imagine that) The police said you cannot leave someone stranded at the store. I need to know ASAP if he could get in trouble for this and if you find out where it says he can please give me the source! THANKS!!!
He repos for the used car lot he works for. I asked every department if he has to have a license to repo. There is no need for a license to repo. He is an employee of the car lot.
My husband was not arrested but he has to fill out a bunch of bull crap paperwork now.
Yes he always has a folder with all the documents required and reports it to the local police station as a repossession once the vehicle is in his possession.
Police car auctions and goverment seized car auctions – get repossessed cars for a fraction of their cost
27th January 2011
Government police auctions and government seizure auctions are usually a cheaper alternative available to those who battle to secure enough of a budget to be able to afford to purchase a car from a new or used car dealership.
Often by scouring the locals adverts in newspapers regarding government car auctions as well as a search for police auctions and government auctions online will yield positive results for those looking to take advantage of these car auctions.
The government will have seized these cars from those who may have outstanding speeding tickets. Banks and financial institutions are another avenue that brings these cars to the auction block through bad payments and are often sent to repossession auctions held with other types of car auctions to provide a diverse offering to the public.
The government and state department that often put these cars up for auction are not in the habit of trying to wait for their price as it is often better for them to return the funds generated to monetary circulation so that they can generate more bank interest and revenue. This means that there are some great deals to be found at government and police auctions.
Buying the same cars from a used car lot may sometime cost in the region of 300% more than you could secure a decent car or SUV for at an auction.
Being sharp witted and wise to the price for certain cars on the open market could even yield a handsome profit if you were to decide to speculate a little of your saving and approach the car auctions as a business venture. There are often many students who search for cheap and affordable cars with often quite a decent budget. This opens up a whole new revenue stream for those folk who regularly attend auto auctions to understand the market prices for cars.
There is a benefit in knowing that these cars that are bought through police and government auction are definitely road worthy and should be easy to license as their source is the police after all.
Government police auctions and government seizure auctions are usually a cheaper alternative available to those who battle to secure enough of a budget to be able to afford to purchase a car from a new or used car dealership.
Often by scouring the locals adverts in newspapers regarding government car auctions as well as a search for police auctions and government auctions online will yield positive results for those looking to take advantage of these car auctions.
The government will have seized these cars from those who may have outstanding speeding tickets. Banks and financial institutions are another avenue that brings these cars to the auction block through bad payments and are often sent to repossession auctions held with other types of car auctions to provide a diverse offering to the public.
The government and state department that often put these cars up for auction are not in the habit of trying to wait for their price as it is often better for them to return the funds generated to monetary circulation so that they can generate more bank interest and revenue. This means that there are some great deals to be found at government and police auctions.
Buying the same cars from a used car lot may sometime cost in the region of 300% more than you could secure a decent car or SUV for at an auction.
Being sharp witted and wise to the price for certain cars on the open market could even yield a handsome profit if you were to decide to speculate a little of your saving and approach the car auctions as a business venture. There are often many students who search for cheap and affordable cars with often quite a decent budget. This opens up a whole new revenue stream for those folk who regularly attend auto auctions to understand the market prices for cars.
There is a benefit in knowing that these cars that are bought through police and government auction are definitely road worthy and should be easy to license as their source is the police after all.
Dale Nelson writes informative articles on automotive topics and real estate issues in particular and is a qualified assessor by trade.
Find more of his writing on hubpages at http://hubpages.com/hub/repossession-and-police-auto-auctions
Dale Nelson writes informative articles on automotive topics nad real estate issues in particular and is a qualified assessor by trade.
Article from articlesbase.com
Used car taxes and government fees in California?
19th January 2011
I’m looking to buy a used car here in California. A lot of people tell me to avoid dealers because of taxes and other fees, but about how much more will that add if I’m buying say a Toyota Corolla at around 11,000-12,000?
And also, if I look to buy from a dealer how can I negotiate the price? Or can I? Any tips to getting a good deal when buying from a used car dealership?
How can a auto lender report you if they never paid the car lot in full?
28th December 2010
I have not so good credit and 4 kids. I purchased a van from a car lot under credit acceptance. It was a 93 dodge caravan that was a piece of crap anyway. I was placed under 300 a month payment with "FULL COVERAGE" LOL insurance. The people at the lot told me and the people at credit acceptance said "The dealer doesnt get paid until you pay". SO in my mind this was like a RENT TO OWN. I had to have the car voluntarily repo’d because it was too expensive, and not reliable. Now they have placed this in my credit report saying I owe them like 4000. How can I owe them that if they never gave the car lot the money in the first place? They also auctioned the car after I had them come and pick them up. This is unfair to me and doesnt seem like a real loan. I have disputed this already and they keep saying I owe them. Money was never truly lent on my behalf. Please help me understand what to do. Thanks




