Buying or selling your car in an auction can
give you a headache if you do not have any idea what you are getting
yourself into. Let me give you some answers for the most frequently
asked questions about auctions.

What is an Auction?

An auction is one of the first means of doing business and
profitable exchanges. History books show that art, land, crops even
people were being auctioned off in the past. Hey, even the Roman Empire
was auctioned.

What about Automotive Auction?

An auto auction is the ideal environment for car dealers to
remarket their cars. This is the perfect opportunity to make the big
bucks and get that great sell that you have been waiting for. The true
market value of the vehicle is also determined once a vehicle is put on
an auction block.

Auto auctions exist to market cars. Its main objective is to make
the deal fast and accurate. It serves as the impartial trading floor
which offers security and integrity to the participants. It also varies
in size depending on the number of employees, cars or how big the area
they occupy.

Auto auctions may also offer different services like, repairs,
reconditioning, financing, arbitration and a host of other services.

How do I participate in an auto auction?

As there are a number of auction houses available, choose a
reputable auctioneer to buy or sell your car to. Keeping in mind the
kind of car you want to sell or buy, the geographical convenience and
the services the auction operators offer, these factors will determine
the auction you will want to participate in.

Be also aware if the auction is an open or closed auction. Open
auctions, as the term suggests, are open to any registered dealer. Most
auctions are open but may be tailored to specific kinds of vehicles
like car fleets, rentals, repossessed units or special dealer
consignments. A closed auction is limited to specific participants.

It is also advised to check the websites of the auction houses you
want to participate in. It is a good idea to request for an auction
tour. This will give you the chance to inspect their facilities and
operations. This is also the best time to ask and clarify details such
as the biding process, services offered and other questions which comes
to mind when you are inspecting the lot.

Once you have decided which auction house to participate in, get
the necessary paper work done and be sure to have an identification
card and a bidder’s badge. If you are buying, get a hold of the ‘run
list’, which is a computerized list of vehicles being auctioned off on
a specific date, the commercial consignor and similar information. It
is also a good idea to get a sales lot parking plan. Vehicles are
typically grouped and the parking lot plan will help you locate which
lane to go to.

What is a ‘floor price’?

Also known as the ‘reserve’ or ‘low’, the floor price is the lowest
price the seller is asking for. If the price is not met while on the
block the seller can lower it to attempt a sale. If the floor price is
still not met, the vehicle can be placed in the “if bid” where the
bidder agrees to buy the vehicle if the seller agrees to his offer in a
specific period of time.

How do I evaluate the vehicles?

There are usually pre-selling inspections where you can appraise
the vehicles that are being auctioned off. Each vehicle has a
windshield marking where information like the seller’s name, model of
the vehicle, mileage, run number and lane assignments are posted.

For a fee, post sale inspections are also available in some auction
houses, where auction mechanics are available to check the engine,
air-conditioning, brakes, frame, transmission and the rear end.

It is also wise take advantage of the free arbitration services
which protects the interests of both the buyers and sellers of the
vehicles. You can also test-drive the sold car if you present a valid
I.D. to the arbitration department. Most auction houses have test
tracks, so make use of this service and be assured that you got your
money’s worth.

What happens after I won the bidding?

After your purchases have been completed, go to the front office of
the auction house and finalize your transactions by making the required
payments. The title is then transferred to your name. A gate pass will
be issued for your purchased vehicle.

What are Internet Auctions?

Auction houses are taking advantage of the present technology
available to them. Cyberlots or cyber auctions allow sellers to post
their vehicles on the net, including photographs and information about
the specific car they want to sell. Most cyber auctions have limited
time frames.

About The Author

Perry Gibson is a long time auto auction attendee and also, co owner of Here he helps shed some light on auto auctions.