Anyone ever purchase a vehicle at auction?

[tvp2003]

For example, at a police seizure auction, or bank reposession:

http://www.calgaryparking.com/auctioninfo.php3
http://www.regalauctions.com/

Curious as to what kind of deals are available... good place to pick up a relatively cheap set of wheels?

[bluejays]

I went to a police auction here in Toronto a few years back to see what it was like and it was honestly a complete waste of time. There were a few cars worth hopping upon, but surprise, surprise, the police were actually doing the scamming. I think I went in 2002 and there was a 2000 Mustang with higher milage which was still in excellent condition, with who knows what happened in that car. Anyway, time comes for the auction and they start the bidding at $7K or something, and a few people hop on right away, but when bidding comes up to about $10K, everyone tends to hold off looking for cheap deals (hey, it's a police auction). Anyway, all of a sudden these two guys start bidding from $14K (which nobody would touch considering it was a crime vechicle and it was a Ford with high milage). So these two guys who were in the crowd, supposed to be part of the crowd, stop bidding and one of them "wins". He sits quietly down, no smile, nothing. These two jokers do this a few times for most of the better cars. Low and behold, some of those same cars were on the block the next week. You quickly realize they're willing to let the crappier cars go for whatever, but some of the newer cars they will not let go for below a certain price. If that's the way official police auctions are done here, who knows if they're done the same way there.

[Ford Prefect]

I don't recommend them from personal experience. Vehicles like that can have liens on them, as I found out. I bought a vehicle at a police auction once and within two hours of bringing it home it was seized and towed away due to a lien than an ex-girl friend of the previous owner had put on the vehicle. I got my money back, but what a hassle.

[jolinar of malkshor]

I haven't bought one but I sold one at an auction. My 1990 Mercury Cougar V8 in 2001. It was nicknamed the reservation racer. Anyhow, I sold it as is and I got $800 for it. 6 months later I get a letter in the mail from Peel Regional Police. ( I am in Alberta) telling me to come pick my car up at the impound lot.

[burn_this_city]

^^ LOL that happened to my buddy.. They just never registered it.

[browna]

From the limited ones I've gone to (Michner Allen), there really aren't that many good deals, certainly for later model vehicles. You can 't get them looked at, you can't do lien searches in advance and there's usually a pretty high reserve that you don't know if you passed until after the bidding is done.

A couple years ago, we were looking at one, went for $19K. A week later the same vehicle was in the autotrader for $22K. Went up and saw it, realized it was the same one we were looking at. Reason is, it didn't make the $23K reserve. Then, was mildly interested so did I lien check, sure enough GMAC still had a lien on it.

Although it may save you some time if you're looking at a wide selection of vehicles as opposed to calling around to ads in the autotrader, that advantage is negated by the fact that the price in the end isn't much of a saving (people, like in all auctions, overvalue their possesions), you don't meet the owner personally (which can tell you right away what condition the car is in), no option of getting it checked out mechanically beforehand (if you're not mechanically inclined yourself and spot issue while at the auction lot before it goes on the block). Just my 2c.

[3 Justin 3]

Odd question, but what is a lien?

[Vulcan]

I've bought a couple of cars at the auction. One was an x cop car which I wanted because it had factory propane. Never spent more than a couple of thousand dollars and never ended up with a lemon although I expected to spend a few dollars to bring them up to snuff. When I wanted to spend more, I didn't go to the auction although I understand Regal has some arbitration for their more expensive sales.

also you can go before the auction and start up the cars you are interested in and look for oil leaks etc.

[Rathji]

Originally Posted by 3 Justin 3

Odd question, but what is a lien?

In terms of this thread, it is a debt that is registered to the car. For example if you borrow money to buy a car, your lender might put a lien on the car if you don't meet your payments.

Edit: Also from wiki

a lien is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation

http://en.wikipedia.org/wiki/Liens

[Kjesse]

I'll try to state simply the implications of a lien on a car. Its not easy because there are so many minor details that whole books have been written about liens and their implications.

A lien on a car is similar to a mortgage on a house. It is debt that attaches to the asset. Liens and mortgages are securities that give an unpaid lender a realizable interest in the asset... in other words...

...whoever owns the lien (the lender) can, if payments aren't made under the debt according to whatever agreement is in place (the loan), force the sale of the car and have the loan paid from the sale proceeds.

So if you buy a car you think is worth 10K at auction, for 5K, and later find out there was was lien on the car for 5K, the lien holder could seize the car you paid for, sell it.... and whatever it sells for, the lien holder gets the first 5K, and you get the balance. (Keep in mind fees for the sale and fees for the seizure usually get paid first.) If the car sells for 7K, you get 2K back at most. If the car sells for 4K, you get nothing.

You can always find out if a lien exists before purchasing the car (liens, and all securities, must be registered to attach to the asset... in the case of cars, at a provincial registry), so I'm not sure how Ford Prefect got into that mess. It can happen though. You'll note he got his money back, it sounds like someone made a mistake (and the mistake was likely not Ford's).

The auctioneer is not there to defraud you, it is in their interest to disclose if a lien exists, and that is the common practice... when you buy at auction you should always check the terms of the sale, but normally you are bidding based on a clear title being passed to you.

To go further than what I was trying to answer:

People at auctions who seem to bid the price up but aren't legitimate purchasers, but instead are ensuring an item won't sell below a certain price (regardless of the secret reserve price) are called 'shill bidders', and that is illegal.

The reserve price is set and kept secret for a reason... it is the lowest price at which the owner is obligated to sell. If you bid and win the auction, but your winning price is lower than the reserve price, the owner has an option to refuse to complete the transation. If your bid is higher than the reserve price, the owner is obligated to pass title.

Reserves are there to allow the seller protection from a disaster, and should discourage the owner from planting shill bidders. If the auctioneer announces that an item is being auctioned with "no reserve" you should rejoice that there is a chance that Ferrari might be yours for $100, but remember that someone willing to take that much risk may have also planted someone on the floor to make sure you won't get it for that price.

Caveat Emptor

[Deegee]

You can usually get good deals on bank repos.

At our credit union, we have sold a couple of seized cars at great prices privately in our parking lot because sometimes the cost of doing it through an auction just is not worth the increase of a price we might get and we were just looking to write off less then we might of otherwise.

[MoneyGuy]

A friend of mine has bought several cars this way. He says that if you know what you're doing, this is where the best deals are. The first time I buy a car at an auction, he's coming with me. He's agreed to do that.

[Clarkey]

There's about 400 white oilfield fleet trucks a month at Michener Allen. I bought an SUV for about $5-6000 less than it was worth. It was a risk though and it could have potentially ended up costing me, but I factored the potential risk into my bid. I would say that even if you aren't that serious about buying you should go check out the auction just as an observer, it's great entertainment. Farmers, pimps, hutterites, wealthy, poor you run the gambit.

[automaton 3]

^^^Yep, great entertainment. Plus its pretty exciting to bid if there is something you're interested in.

I've bought a number of vehicles through the auction. Generally they're not too bad, but I have bought a few lemons. The lemons I usually just put them right back in the next auction...generally lost a couple hundred dollars but never more than that.

As for liens, the auctions I've been to certify no liens. I did buy a car once that ended up having a lien they couldn't clear - they promptly took the car back and refunded my money.

Have bought a few really good vehicles in the auction though. Try to start up the vehicles if you can. Try them in all gears to make sure the tranny works and isn't making any undue noises. For 4x4's see if it will go into 4 wheel drive. Look for leaks ect. A too clean engine bay is sometimes an indicator that they're trying to hide something though. Ask the guy driving the car into the ring (easier at Michener Allen, there is usually a lineup of cars waiting to go in) about how the vehicle is working, sometimes they'll offer a tidbit of information but not always.

If you go in with prices in mind and expect in your budget to put a few dollars into the vehicle you'll probably come out ok.

Anyhow, great fun and good luck!

[stang]

Originally Posted by MoneyGuy

A friend of mine has bought several cars this way. He says that if you know what you're doing, this is where the best deals are. The first time I buy a car at an auction, he's coming with me. He's agreed to do that.

Yeah a guy I work with has bougth all of his vehicles at the auction... He has got a New Dodge Diesel that he loves.

Originally Posted by automaton 3

^^^Yep, great entertainment. Plus its pretty exciting to bid if there is something you're interested in.

I've bought a number of vehicles through the auction. Generally they're not too bad, but I have bought a few lemons. The lemons I usually just put them right back in the next auction...generally lost a couple hundred dollars but never more than that.

As for liens, the auctions I've been to certify no liens. I did buy a car once that ended up having a lien they couldn't clear - they promptly took the car back and refunded my money.

Have bought a few really good vehicles in the auction though. Try to start up the vehicles if you can. Try them in all gears to make sure the tranny works and isn't making any undue noises. For 4x4's see if it will go into 4 wheel drive. Look for leaks ect. A too clean engine bay is sometimes an indicator that they're trying to hide something though. Ask the guy driving the car into the ring (easier at Michener Allen, there is usually a lineup of cars waiting to go in) about how the vehicle is working, sometimes they'll offer a tidbit of information but not always.

If you go in with prices in mind and expect in your budget to put a few dollars into the vehicle you'll probably come out ok.

Anyhow, great fun and good luck!

Another thing to look for is if ite been in an accident

http://www.samarins.com/check/bodycond.html

[alltherage]

My Dad's been playing the auction since I was born. He loves driving different vehicles and changes rides every 4-6months. He's has some bad luck, but I would say no more than 20% bad cars. When he's scooped something that was in bad shape he literally turns it around before he gets to the registration office and puts it right back through.

I'd say as long as you pick something with reasonable clicks and it sounds ok and you can take a glance at the engine etc you are ok. Also, look for signs that the previous owner cared about their car. Things like car alarms, oil change stickers, clean rims, etc.