You’ve Seen Auto Auction Tips Before…These Are The Ones That Matter
Going to a live auto auction for the first time can be intimidating. There are huge crowds, the stakes are high, the are are seasoned bidders, and an auctioneer who speaks gibberish. The excitement gets your blood pumping, which also leads to emotional bidding and assigning emotional value to vehicles. Below we are going to focus on auto auction tips for success.
If you follow these tips you will learn how to evaluate an auto, ask the right questions, and bid only on vehicles that have value.
15 Auto Auction Tips for Success
All the tips are covered here in the graphic and then explained in further detail below…
1. Watch a Live Vehicle Auction First
If you have never been to a vehicle auction before, you should attend one first. It doesn’t matter if it is a repo auction, police auction, vintage car auction, or even a motorcycle auction…go and watch. You need to understand the flow of the event. Watch seasoned bidders, dealers, and collectors and study how they play the game. They almost never make the first bid and so often the last. Watching what vehicles they bid on is just as telling as what they don’t bid on. Understanding how to navigate and participate at a vehicle auction is critical to success.
2. Go In With a Plan and Expect the Vehicle Needs Work
Live auto auctions ain’t what they used to be. Most vehicles are going to require some work unless, your at a high end vintage auto auction with showroom cars.
If you are going there to get a used car, be prepared that you may need to do some work. If you are not a mechanic yourself, have a plan before hand. Know who is going to work on this car for you, what are their rates. You need add it in to your total costs.
People bid on cars and then get surprised when the cost for repairs wasn’t figured in. If you can the work yourself, that’s ideal..if you can’t add repairs in.
3. Read the Vehicle Catalog Carefully
Look at the auto auction catalog with critical thinking:
- Is anything out of place…why is a an old 50’s Mercury station wagon being sold at a muscle car auction?
- Do all of the numbers match?
- Is this a resto being passed off as original?
- How could the mileage be this low?
- Is this a rebuilt engine?
- Is their a trail of evidence showing history of ownership?
Whatever questions come in your mind take notes. If the catalog is online, print it out and write on it. Circle things you want to double check, circle parts of the vehicle you want to inspect. This is your pre-auction homework part 1.
4. Research and Get Comp Prices
This is your pre-auction homework part 2. This exercise is all about the market and estimating the value range of the vehicle.
For every vehicle you are interested in, look them up online.
- Look at Kelly Blue book values
- Look up value in Edmunds
- Find comps on Ebay, and Craigslist
- If a junked autos or salvage title, find the vehicles curb weight and estimate it’s scrap steel price.
This is your time to understand the market and figure out how much one of these autos goes for on average. Find two or three comps and write them down next to the vehicle in the auction catalog.
5. Go To The Live Event Do Not Proxy
I’m not a fan of proxy bidding (online auctions or phone bids). Not a fan of buying a vehicle I haven’t seen in person. No one once has ever bought an auto on Craigslist and thought “wow, this is way better then i thought”.
The event is where it is at. You need to be in on the action, feel the flow of the event, and even pay attention to why others are not bidding. It could be a sign you missed something, but if you did your homework, you can bid with confidence.
6. Inspect the Vehicle Thoroughly
You should absolutely attend the pre-auction inspection period. These are held either the day before or hours before the event. This is your chance to fully inspect the auto.
You need to ask yourself:
- Does the description in the catalog match the vehicle? How about the VIN?
- Is the color right?
- Are the numbers like mileage in the catalog the same I see on the odometer?
- What does the motor sound like?
- Are there any leaks or smoke?
- Does it smell musty?
- Are the carpets damp?
- Is the frame straight?
- Is there rust anywhere?
- Are there documents available to review?
- How about service documents?
You should consider bringing a mechanic with you if you don’t have experience with these things. Additionally you should look up the VIN and the CarFax report on it. Your goal here is to adjust those comp prices down or up based on your findings. You need to establish the true value of the vehicle.
7. Ask Questions to the Owner
If the vehicle owner is there ask him questions directly. If they can’t answer your questions…it is a red flag, “I don’t know” is not acceptable. A deal that looks to good to be true, probably is. The owner should be available and answer questions about service, performance, current issues, repairs it needs, after market parts, etc. Don’t take everything as facts, bondo, polish, and paint can hide a lot of problems.
They may not be the original owner, but they should be able to speak to where it came from. The exception to that would be a salvage title vehicle or a vehicle at a government auction.
8. Estimate The Value
Most of your tasks above have been leading up to putting a price on the vehicle.
- Make an honest estimate on what you think the auto is actually worth
- Then estimate a high and a low range above it.
- Where do you fall in the range? What is the auto worth to you?
- Does the model of vehicle have any emotional value for you?
The key here is to find the real value and assess where you feel you should be. It’s ok to over bid a vehicle that is your dream automobile. It’s not ok to overbid 2001 Sentra, with a 200K miles, a missing quarter panel, and duct taped bumper.
9. Register Early and Prove Your Financial Commitment
This type is true for any type of auction you attend. Don’t lollygag getting to the event, you may miss the auto’s you want. Get there early and register, sometimes there are long lines. You will need a government issued identity like a driver license or passport. Bring your credit card and a bank statement to prove you can pay. Be prepared to sign a contract that makes your bid a legally binding agreement.
10. Know the Schedule and Where You Need to be
Get a program and find out the schedule and order of the vehicles as they come across the auction block. Mark the schedule for all the vehicles you have on your radar. If it is a multi-ring auction, bring a friend, to watch a ring for you and alert you when you need to be there.
11. Be There to Bid, Not to Socialize
Come there and be prepared to engage. Don’t bring friends unless they are there to help, don’t wander around, don’t talk while bidding. You can miss your opportunity so quickly if you aren’t paying attention. Stand where the auctioneer can see you. Don’t make any gestures, like nodding your head at some random woman you like across the room…you may have just bid on a junked vehicle by mistake!
12. Stay Out of A Bidding War and Stick to Your Price
Bidding can get very emotional particularly in a no reserve auction. Set your price in your head (preferably the one you wrote down in Tip #8), stick to it, don’t waiver, and don’t get emotional over being out bid. You need to bid with your wallet and brain, not your emotions. if you have done all of your pre-work estimating the value…you will know when you should stop bidding and let some other sucker over pay. Don’t be the sucker, that’s what they want.
13. Do Not Hesitate Especially at The End
Trust your estimates and do not hesitate to bid up to your top price. Auctioneers do not wait for slow bidders. If you hesitate you may miss out on the vehicle if the auctioneer yells “Sold”. Bid with confidence and conviction right up to the value you assessed on the vehicle. Once it passes that number, you can walk away.
14. If You Win, Don’t Drive it Home
Auction houses will ship the vehicle to you. You just won, this and yet you have never driven it. Don’t get stuck on the road and add repair bills on top of the final sale price. They will ship it in an enclosed trailer, let them do that.
15. Act Like You’ve Been There Before
Winning is exciting, but don’t lose your head. As fast as you throw your hands up in victory, someone from the IRS is looking at a snapshot of you winning and asking for the sales tax. When you win, act like you have been there before. Go to the administration table, sign the title, pay the freight, and make sure you have ALL of the documentation that comes with the vehicle.
Auto Auction Tips Conclusion
Auto auctions are a lot of fun. Many of them are moving online for convenience and reaching broader audiences, but the best way to bid is live. You will be able to evaluate the autos for quality and value as well as make more educated bid estimates. Pictures, videos, and descriptions online just can’t do an automobile justice. You need to take detailed notes, fact check everything about the vehicles, ask questions, and listen them run.
Bidding is all about knowing the real value, being relaxed and unemotional, and strategically bidding when it’s your price. If you follow our auto auction tips above you can bid like a pro. You want always go home a winner, but you certainly want come home, with a junked car that you paid MSRP on!