Car Auctions: The Basics

Buying a vehicle at a car auction can be a smart move to snag a good used car at a significantly lower price--but keep in mind the "buyer beware" motto. To secure the best deal, it's important to do your research, know how much you're willing to spend and review the car of your choice carefully.

Be a Smart Consumer

Car auctions can be tricky affairs. While there may be plenty of hot deals out there, there also may be many vehicles not worth your money. Unlike buying at a dealership, where the transaction is in writing and cars come with warranties, at an auction there are usually only verbal promises. The cars usually don't have warranties and, unless the title is fraudulent, the deal is final. You don't always know what you're getting.

Two important things to check about the car are the VIN (vehicle identification number) and the mileage. Typically you have a grace period of two days to inspect the car before bidding. Take advantage of this time: perform a title check. You also may want to buy a used car extended warranty.

One way to get the most out of an auction is to do some legwork beforehand. Find out about the car models that you prefer and determine your likes and dislikes in engine performance, color and size. Make sure you have a general idea of what you want--you won't have much time to make a decision once you're there. One essential is to set a bid ceiling. Know how much you can afford to bid and stay at that maximum.

Determine the Car's Value

Figuring out what the car is worth is key. If you are not familiar with cars, you may want to bring along a friend who is; if you can afford a qualified car auction expert to check things out, you can really cover all your bases. Keep in mind that you also may be paying a premium above your bid.

It can be easy to let your emotions rule at a car auction. While a shiny black Lexus may steal your heart, it may be more than you can afford. Sticking to your bid ceiling is a smart way to protect yourself against buying a car that is over your budget.