Repossessed vehicles have become a big part of today’s economy. People with outstanding auto loans who fall on hard times and cannot make their monthly car payments – continue to find themselves in the unfortunate reality of car repossession. The banks disburse auto loans using the purchased automobile as collateral for the loan, so as the banks repossess the collateral (the automobile), the banks immediately loses money.

When a car is repossessed the sale value of the car drops. The reason for the decline in sale value is because bank repossessed cars are normally sold at auctions. People, rather they are individual buyers or dealers, who are lucky enough to find out about these auctions do it for one purpose – to buy bank repo cars for a fraction of the cost.

Finding Bank Repo Auctions:

In the U.S. many banks have their own websites that will list their repossessed homes, repo boats, cars and more, if your bank doesn’t have a website calling them or better yet visiting them and asking the bank manager directly can prove fruitful. There are also many online services offering state by state auction listings.

Tips On How To Buy Bank Repossessed Vehicles

Here is a tip that may save you some money, you can visit www.US.gov and enter a search term like “florida auctions” , “california auto auctions” etc and you’ll be provided with results of many different types of auctions. With a little elbow grease and time you’ll uncover many auctions in your state.

Determine Your Car’s Value:

Before attending an repossessed car auction you should have a rough idea on what they’re selling for beforehand. Do a search on sites like nada.com, edmunds.com or kbb.com (Kelly Blue Book). If you know the type of car, truck or boat you’re looking for you enter a variety of search terms based on it’s year, make, model, mileage etc, this will give you a price range for retail, trade in private party sales.

Now Your Price Before The Auction:

If you’re going for a bank repo you likely are doing so to get more car for your money. This being the case, you want to pay a wholesale price, this will allow you to obtain a more luxurious ride for your budget. (Just make sure the vehicle is in good shape or factor neccessary repairs into your budget.)

Keep Your Head Straight

Auctions houses and auctioneers want to create bidding wars, the higher they’re able sell the vehicles for the more they pad their bottom line, set your budget ahead of time and don’t get caught up in a bidding war.

Don’t Buy A Lemon

Most auctions allow you to inspect the cars ahead of time, if you want to make sure you’re not getting a piece of junk a carfax report will go a long way, if it raises suspicion move on and don’t waste your money. Whenever possible take a qualified mechanic to give his/her opinion even if you have to pay them for their time, it will be money well spent. Danger signs on a vehicle include:

  • Dents and scratching
  • Bald or extremely warn tires
  • Do it yourself body repairs
  • Oil and fluid leaks
  • Dirty, ripped or unusually worn interior

The physical condition of bank repossessed cars can fall in between any where from maintained/well taken care of vehicles to neglected/never been serviced vehicles.


Did You Know: The Other Side Of Selling Bank Repossessed Cars

Bank repo cars for sale can be seized as soon as there is a default on the loan or lease. After the vehicle is taken over by the bank they normally resell it at auction be it private or public. Some states require the bank to notify you of the time and date of the auction. You may have a short window to redeem or buy back your car if you’re able to satisfy the loan in full plus penalties and costs associated with the repossession including lawyers fees, repo company charges etc.