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 repo cars for sale for a fraction of the their actual value.

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 one of the many bank repos around, you are 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.  There are many online auto auctions popping up these days, they appear to offer a great deal on vehicles but without the opportunity to inspect the vehicle you’re taking a big risk on it’s actual condition, many online auctions offer a grace period for you to inspect the vehicle but this will be an added expense in most cases that needs to be factored into the price.

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. If you’re a victim of a car repo 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.

‘Slang for Repossessed Cars’

Most people interested in repo cars are interested in the price and quality of vehicle you can purchase. Repossessed cars come to us from one main source namely; people who forfeit on their payments.  In today’s economy there is an increase in amount of repossessed cars for sale, most are sold at auction to individuals or used car dealers who will flip them on their lots.  Car repo is becoming more commonplace as the state of the economy worsens and more and more people are simply walking away from their leases and financial obligations.

How Repossessed Cars Come To Be

After missing numerous payments or sometimes as little as 1 or 2 payments and failing to bring your account current with your car the lending company has taken steps to have your car repossessed.  If 60% or more of the loan has been paid the creditor must by law sell, lease or dispose of your car, this is usually done via repo car auctions.  This is true unless you have signed a statement after the default that allows them to keep your auto in full payment of the loan.  The sale of your car must be held within ninety days after it has been repossessed. You must be notified of the date, time and place of the auction or sale.

After The sale

Once the repossessed car is auctioned or sold, the funds derived from the sale are required to go to the outstanding balance owed on the loan including the the costs of the sale/auction and applicable lawyers fees and repossession costs i.e. Towing, storage, emergency repairs etc.  Any overage resulting from the sale or auction of the repo car for sale must be paid to the buyer. Normally the funds raised at auction or from the sale are insufficient to cover the outstanding amount owed, in this case the re-possessor may choose to sue the consumer/owner for the full amount owed including legal fees, repossession fees, auction costs etc.

Retrieving repocars is possible and you have the right to redeem it until the time it is sold or within 21 days of receiving legal notice that the lender/creditor is choosing to keep it. Costs will be dependant on the terms of your contract and it is likely you will still have to pay legal costs, towing, storage and more. The majority of seized vehicles go to auction.

Where Can I Find A Repossessed Car to Buy?

You can find repo’s on many different  auction websites like eBay and other similar sites. You can also search your neighborhood for auction houses, banks, and lending companies who have auto loans. Another sure bet that will feature bank secured cars is the classified ads in newspapers and even used car dealers or other auto dealers in your area, the majority of used car dealers dabble in them.

How To Buy A Repossessed Vehicle

The majority of repossessed cars go to auctions, it’s best if you have a plan of attack before attending and car auction to purchase a car.

1. Don’t go alone, take a friend or family member, better yet your local mechanic, if you don’t have one you can even pay a mechanic to come along to give the car an inspection.

2. When you arrive you’ll need to register, they’ll give you a bidders badge, copy of the inventory for auction, rules and regulations etc. You’ll also likely need to provide them with a credit card.

3. Highlight any vehicles you’re interested in on the inventory list.

4. Use the Edmunds Used Car pricing guide to determine the high and low range wholesale value of the vehicle. It’s condition will determine it place in within the range.

5. Use an inspection sheet to grade the vehicles you’re interested in, this is where your mechanic will be invaluable.

6. Make sure you start the vehicle and listen for strange noises, odours and leaks.

7. Finish your inspections with plenty of time before the auction starts.

8. Know the maximum you’re prepared to pay for the car and stick to that number, it’s easy to carried away at an auction and that’s what they count on.

9. If you’re the winning bidder you’ll be required to make final payment arrangements before leaving, make sure you know the rules beforehand.

10. To make payment you’ll be required to go to the main auction office where you’ll make final payment. Here you’ll get a U.S Government title transfer certificate, a damage disclosure statement, the auctioneer’s receipt with odometer reading and your keys.

This gives you a good outline on how to buy repossessed cars, finding the repo auctions and more, please continue to browse our website for more repo car tips and tricks and more!  You’ll also find that cars aren’t the only vehicles available at a repo car auction, you’ll also see lot of repo boats, rv’s, motorcycles, atv’s, jet ski’s and pretty much anything that moves.  As with any used vehicle you’re always advised to inspect the item as thoroughly as possible and whenever possible take a qualified mechanic to give it a once over.