6 Things To Keep In Mind About Online Auctions
The feeling you get after buying a brand-new car is something else entirely; however, cars are the second-most expensive investment you make after a home and not everyone can afford a brand-new one. However, that doesn’t mean you should lose hope and resign yourself to living your life without a car. There are ways you can get a nice car at a great price — one of the most popular options is online car auctions!
Although you may be excited to buy a car, it is important that you not jump the gun and make an impulsive buy. There are several things to keep in mind before buying a car from an auction.
But first of all, let us take a look at how auctions work:
HOW DO YOU BID IN AN ONLINE AUCTION?
One of the best things about online auctions is that they get their inventory from a number of different sources, including ex-government cars, ex-police cars, cars from Copart and Insurance Auto Auctions, and more.
In an online car auction, the buyer competes with other buyers rather than the seller during the bidding process. Once you win the bid, the car will be awarded to you and there can be no refunds. So, you need to be extra careful about what kind of car you want and how much you are willing to pay for it.
When you start bidding on a car of your choice, you will see that the bids open with a too-good-to-be-true cheap price. This is the reserve price that is set by the seller and the lowest amount that will be accepted. If no one is willing to bid even up to the reserve amount, the car may not be sold. However, if a person makes a bid, whether at the reserve price or above it, if not else bids on it, he will have to complete the sale and buy the car.
The process is pretty simple, though you need to be cautious and do all your research to ensure you get the best car for yourself. Here is how you can do that.
TAKE STOCK OF THE INVENTORY
Certain online car auctions like RideSafely.com have a huge inventory with hundreds of used and salvage cars. These cars are acquired from government auctions, police compound auctions, Copart Auto Auctions, and Auto Insurance Auctions.
Since these are displayed online on the website, any interested buyer can check out vehicles online, without going through the inconvenience of going to a physical location or feeling the pressure of an auctioneer forcing you to buy a car you have no interest in.
You can find all sorts of car makes and models on online auctions and even cars that have not been used much but have been sold to an auction because they have cosmetic damage. These cars can be easily fixed without you breaking your budget and can serve you for several years to come.
You can also find gems like limited edition models in our online auctions. These cars are more expensive than the mass-produced standard model but they also come with a “wow” factor. Additionally, customized cars that were pre-owned by celebrities also come with a slightly higher price tag but can help you make the coolest kid on the block.
CHECK OUT THE YEAR OF MANUFACTURE OF THE CAR
A used or salvage car can be cleaned up and look brand new; however, the value of the car lies in its year of manufacture. That’s because cars depreciate.
In the first five years of use, a car will see the most depreciation and may lose about half of its original value. After this time though, the depreciation slows down. It is best if you can get a car that is less than five years old. Avoid buying cars that are over 10 or 15 years old because they are at the end of their life cycle, even though they may appear to be newly minted.
You also need to find out what your state laws consider to be a road-safe vehicle and if they prohibit driving a car that is of a certain age. Also keep in mind that older cars have a bigger carbon footprint, which can result in hefty fines for you. Hence, always make sure to look at the year of manufacture when you are buying a car.
FIND OUT THE REPAIR COST AND INSURANCE
You can find many vehicles on auction that require only minor repairs or will work well with some cosmetic fixes. However, if you buy a car that looks nice on the outside but is a total lemon from the inside, you may experience thousands of dollars of financial damage — and in the end, you may not even have a working car.
Hence, before bidding on a car online, make sure you do your homework and ask to assess the internal components of the car. You can also request a mechanic to look at the car and give you a report of its condition.
In addition, used cars will also need insurance before they can be taken out on the road. The insurance for used cars is higher than insurance on brand-new cars, so make sure you can easily afford it before you buy a car.
AVAILABILITY OF SPARE PARTS
As we mentioned before, an online car auction is a great way to find hidden gems like classic or vintage cars, celebrity cars, and limited edition cars. If you are a collector and do not want to take the car on the road, you can buy these unique vehicles for a steal.
However, if you want to use that car, you may have to make some repairs to it. However, unique cars may have certain components that are no longer available in the market. That means you will be stick with a car that can no longer run because you can’t find replacement components for it.
So before you place your bid, make sure all its parts are easily available.
SETTING A MAXIMUM BID
One of the most important things that you need to keep in mind when buying a car from an auction is to determine your budget and calculate your maximum bid. Once you have set a limit to how much you can pay, you can start the bidding with a number that is a bit higher than the reserve amount so that it doesn’t attract a lot of competition. People who are addicted to bargaining may not like the higher price and may automatically filter out from the start.
When setting a maximum bid, also make sure to factor in the insurance cost and the amount you will need to get it repaired so that you can be sure you can afford its actual price.
CAPITALIZE ON TIMEFRAME
It can be worthwhile to choose the time of bidding carefully. Typically, the time between 5 pm and 9 pm is when people are traveling from home to work or are busy with house stuff like preparing and having dinner or spending time with their kids. This means that a lot of people will not be participating in an online auction, which means lower competition for you.
Another good time is to bid early in the morning, if the online auction does that. At this time, people are busy getting ready for work or college.
Another strategy is to bid at the last minute. If you see the highest bid is an attractive one for you, you can add just a few more cents to it at the last minute. There may be a higher chance of you winning the bid if you use this strategy.
THE WRAP
In these times of the pandemic, an online auction is one of the safest ways to buy used or salvage cars. These auctions provide a lot of convenience, variety, and excellent bargains if you are willing to do your homework. We hope the advice above can help you bid on your vehicle the right way and find the car you have always dreamed of.
Find out more: 16 IMPORTANT TIPS AND STRATEGIES FOR CAR AUCTIONS
Originally published at https://auction.ridesafely.com on April 16, 2021.
