Buying or selling your car in an auction can give you a headache if you do not have any idea what you are getting yourself into. Let me give you some answers to the most frequently asked questions about auctions.
What is an Auction?
An auction is one of the first means of doing business and profitable exchanges. History books show that art, land, crops even people were being auctioned off in the past. Hey, even the Roman Empire was auctioned.
What about Automotive Auction?
An auto auction is an ideal environment for car dealers to remarket their cars. This is the perfect opportunity to make the big bucks and get that great sell that you have been waiting for. The true market value of the vehicle is also determined once a vehicle is put on an auction block.
Auto auctions exist to market cars. Its main objective is to make the deal fast and accurate. It serves as the impartial trading floor which offers security and integrity to the participants. It also varies in size depending on the number of employees, cars, or how big the area they occupy.
Auto auctions may also offer different services like repairs, reconditioning, financing, arbitration, and a host of other services.
How do I participate in an auto auction?
As there are a number of auction houses available, choose a reputable auctioneer to buy or sell your car to. Keeping in mind the kind of car you want to sell or buy, the geographical convenience, and the services the auction operators offer, these factors will determine the auction you will want to participate in.
Be also aware of the auction is an open or closed auction. Open auctions, as the term suggests, are open to any registered dealer. Most auctions are open but may be tailored to specific kinds of vehicles like car fleets, rentals, repossessed units, or special dealer consignments. A closed auction is limited to specific participants.
It is also advised to check the websites of the auction houses you want to participate in. It is a good idea to request an auction tour. This will give you the chance to inspect their facilities and operations. This is also the best time to ask and clarify details such as the bidding process, services offered, and other questions that come to mind when you are inspecting the lot.
Once you have decided which auction house to participate in, get the necessary paperwork done, and be sure to have an identification card and a bidder’s badge. If you are buying, get a hold of the run list, which is a computerized list of vehicles being auctioned off on a specific date, the commercial consignor, and similar information. It is also a good idea to get a sales lot parking plan. Vehicles are typically grouped and the parking lot plan will help you locate which lane to go to.
What is a floor price?
Also known as the reserve or low, the floor price is the lowest price the seller is asking for. If the price is not met while on the block the seller can lower it to attempt a sale. If the floor price is still not met, the vehicle can be placed in the if bid where the bidder agrees to buy the vehicle if the seller agrees to his offer in a specific period of time.
How do I evaluate the vehicles?
There are usually pre-selling inspections where you can appraise the vehicles that are being auctioned off. Each vehicle has a windshield marking where information like the seller’s name, the model of the vehicle, mileage, run number, and lane assignments are posted.
For a fee, post-sale inspections are also available in some auction houses, where auction mechanics are available to check the engine, air-conditioning, brakes, frame, transmission, and rear end.
It is also wise to take advantage of the free arbitration services which protect the interests of both the buyers and sellers of the vehicles. You can also test-drive the sold car if you present a valid I.D. to the arbitration department. Most auction houses have test tracks, so make use of this service and be assured that you got your money’s worth.
What happens after I won the bidding?
After your purchases have been completed, go to the front office of the auction house and finalize your transactions by making the required payments. The title is then transferred to your name. A gate pass will be issued for your purchased vehicle.
What are Internet Auctions?
Auction houses are taking advantage of the present technology available to them. Cyberlots or cyber auctions allow sellers to post their vehicles on the net, including photographs and information about the specific car they want to sell. Most cyber auctions have limited time frames.