How Does the Car Bidding Process Work?
In recent years, car auctions have become a popular choice for people in search of a new vehicle. For this reason, more and more buyers are looking to understand how the auction process works. But before we delve deeper into the auction and car bidding procedures, we need to understand more about the types of auctions.
TYPES OF AUCTIONS
Public Auctions
As the name suggests, public auctions are for the public, meaning anyone can attend them. All kinds of cars are available, ranging from battered old models to the newest drives. Generally, the quality of vehicles is not very high, which is why, if you plan to purchase from a public auction, you should take a professional with you who can assess your chosen car and advise on whether you should buy it or not. Cars sold at public auctions can belong to auction companies, private sellers, dealers, and even law enforcement agencies.
Dealer Auctions
These licenses are different from public auctions in that only people owning a dealer’s license can attend them. Every car being sold at a dealer’s auction is new or close to new.
HOW DO CAR AUCTIONS AND BIDDING PROCESSES WORK?
An auction can either be attended physically or online. Every car has a listing price, and if you are interested in a particular car, you can place your maximum bid after inspection. Once the car hits the floor, you can start bidding. Remember that almost every vehicle will have multiple bidders, so be prepared for the starting price to increase. To avoid overspending, stick to your original maximum bid. You may fail to land your first-choice vehicle, but do not be disheartened. There are many cars to be sold, and a car similar to your preferred one might soon come along.
Buying as a private buyer:
If you are a private buyer, you will have to pay a certain deposit amount per vehicle before you can submit your bids.
When you pay your deposit, you will be asked for your ID, so make sure to have it with you. Acceptable ID forms include passports or driving licenses. You might also be required to show a recent bill, such as a utility bill or landline bill from within the past three or six months, or a council tax statement.
Make sure to listen to the auctioneer:
It is essential to make yourself heard to the auctioneer, but it is just as important to focus on what they have to say. Remember that the auctioneer’s description of a car is legally binding and supersedes any previous online or catalog descriptions. It is particularly important to be on the lookout for the following phrases:
- Specified faults: This is the list of faults that the auctioneer will read. Maintain your full attention.
- No major mechanical faults: This means that the car does not have any fault with regards to its engine, gearbox, drivetrain, or suspension.
- Sold with a warranted mileage: This means that an independent third party has inspected the mileage, and the car is being sold based on the findings of that inspection.
- Sold as seen: The vehicle is being sold with any faults it might have, and the auction house will not be responsible for the cosmetic or machinal condition of the car once it is sold.
The bidding process:
If you are attending a physical auction, you would want to stand somewhere you are clearly visible to the auctioneer. Once you are prepared to make a bid, give a clear signal with a raised arm — winks and nods are likely to go unnoticed.
Once the auctioneer acknowledges your bid, keep your ears alert for rival bids, and continue to make clear signals every time you want to better a rival bid. After the bidding has gone beyond the reserve price, the car is awarded to the highest bidder, so make sure that you do not lose concentration and focus. In your excitement and adrenaline, do not forget to stick to your budget.
Once there are no bidders left in the room, the bidding will stop. At this point, the famous hammer will come down, and the car will be awarded to the highest bidder. Remember that biddings are swift, so it will require your complete attention to keep up with the current price and number of bidders present.
WHAT HAPPENS AFTER YOU WIN?
Although the specifics can vary, you will generally be required to leave your deposit on the same day, and then pay the remaining amount within the next 24 hours and take your vehicle away within three days from the day of the auction. As soon as that hammer drops, that car belongs to you, and as the owner, it is your responsibility to ensure that the car is insured, tax, and road legal before you drive it away.
Drive your vehicle away:
Once you have made the full payment, you will be given a pass out slip, the keys of the vehicle, all relevant documentation. Once you receive all of this, you are free to take the car away.
TIPS FOR PEOPLE ATTENDING A CAR AUCTION FOR THE FIRST TIME
- Choose the right auction: There are several types of auctions, such as government auctions, ex-fleet auctions, repossessed vehicles auctions, 4WD and commercial auctions, and damaged cars/salvaged auctions. Decide on the type of auction you want to attend before you start bidding.
- Go with your homework complete: Know the car you want beforehand and have a fair idea about how much it will be worth.
- Decide your budget: Make sure to have a maximum budget in mind, as well as the individual amounts you will be willing to pay for each car you are interested in buying. Do not let emotions cloud your financial judgment.
- Check the car: Although an independent inspection guarantee accompanies some cars, it is best to examine every vehicle to the best of your abilities, specifically the mechanics and bodywork.
- Walk away if needed: Set your budgets, know your limits, act accordingly, and refrain from bidding wars. Once again, do not let your heart rule over your head.
To conclude, car auctions are fun, especially if you know what to expect, and we hope that this article will prove helpful to you in that regard.
Find out more: PROS AND CONS OF BUYING A CAR ONLINE
Originally published at https://auction.ridesafely.com on December 28, 2020.
