In today’s economic tough times, more and more car buyers are looking at police auctions and online auctions for bargains in the used car market.
The huge majority of auction buyers report satisfaction with their cars when contacted 60 days after their purchase, but for some buyers their “good deal” turns into a nightmare.
Smart buyers avoid those nightmares by using technology to guard against unscrupulous sellers and public auction nightmares.
Armed with any sort of mobile browser, iPhone, laptop, etc., buyers can check a car’s history, determine its true market value and avoid making the mistakes that can ruin your chances of having a good auction experience.
With cars being stolen at a rate of one every 25 seconds, anyone considering buying a car at auction is concerned about the problem of buying a stolen car without knowing it and then running into trouble down the road.
There are two main strategies to avoid this problem. The first is to compare the VIN (Vehicle Identification Number) in all three locations where it is found. The numbers should match and they can be found on the driver’s side dashboard, visible from the windshield, under the hood and on the driver’s side door jam.
If you’re buying the car online, you can ask for pictures of the VIN in all three locations. If you’re buying in person, you can easily check these numbers for yourself.
Armed with a verified VIN, smart buyers then use a title search company like AutoCheck to check the history of the car and make sure it has a clear title.
This is particularly important for Police Auction Car Buyers. Smart buyers are aware that police departments aren’t required to have clear title to the cars they impound and later sell at auction. If you’re not careful, you could end up watching your dream deal disappear down the road on the back of a car hauler as the rightful title holder reclaims it. You lose the car and the money you paid for it!
Once you’ve used your laptop or smart phone to go online and get an instant car history report, you will need to assess the car’s condition. This is obviously going to be limited in an online auction, but you can still use the history report to suggest problems with the car and ask the seller for pictures of specific areas of concern.
When evaluating a car in person, you can use the same tricks professional car buyers use to find hidden damage.
• Look for clamp marks on the frame rails under the car. The clamp marks will be holes or gashes on the frame. They are the result of a damaged vehicle being clamped into place and then stretched on a frame straightening machine. It means the car has been in a serious collision.
• Check the bolts used to fasten fenders, doors and the trunk lid to see whether the paint is broken or the bolts are turned, which could indicate the bolts were removed for body repairs to the vehicle.
• Peel back the fabric that lines the trunk and look for welding marks or body filler, which may indicate that repairs were made on the body of the vehicle.
• Look for indications the car has been repainted. Signs like finding a small inconsistency in color between body parts or finding paint on the molding or gaskets. If you run your finger along the inside of the door edge, the finish should be smooth. If it is rough, that may be caused by overspray from repainting. If you find signs of repainting, ask questions to see if you can determine if the paintwork was for minor scratches and dents or to cover up more serious damage.
• Listen for engine noise when you test drive (or test start) the vehicle. Major accidents often cause engine damage.
• Check to see if the doors, the hood, and the trunk lid all close properly. If they don't, or if the edges don’t match well, this could indicate the use of replacement parts due to a major accident.
• Check to make sure the odometer is working.
After carefully evaluating the condition of the car, smart buyers are turning to technology again to determine the car’s true value.
The Kelley Blue Book, the car industry standard for decades, runs an online service that will give you the value for just about any car you will encounter.
Values are divided into three classes:
Trade-In Value - Trade-in Value is what consumers can expect to receive from a dealer for a trade-in vehicle.
This is pretty much the bottom price you can expect to pay at a well publicized auction. This is the price the professional car buyers you’ll be competing against will be willing to bid up to (but not over) so be wise about this one and compare it to the Private Party Value,
Private Party Value - Private Party Value is what a buyer can expect to pay when buying a used car from a private party. This is the price you can expect to get for a car you’re selling to a private party.
It’s the difference between the Trade-In Value and the Private Party Value that represents a profit for the savvy auction buyer.
Suggested Retail Value - The Kelley Blue Book Suggested Retail Value is representative of dealers' asking prices and is the starting point for negotiation between a consumer and a dealer.
Each of these three values is based on the following vehicle condition definitions:
• Looks new, is in excellent mechanical condition and needs no reconditioning.
• Never had any paint or body work and is free of rust.
• Clean title history and will pass a smog and safety inspection.
• Engine compartment is clean, with no fluid leaks and is free of any wear or visible defects.
• Complete and verifiable service records.
Less than 5% of all used vehicles fall into this category.
• Free of any major defects.
• Clean title history, the paints, body, and interior have only minor (if any) blemishes, and there are no major mechanical problems.
• Little or no rust on this vehicle.
• Tires match and have substantial tread wear left.
• A "good" vehicle will need some reconditioning to be sold at retail.
Most consumer owned vehicles fall into this category.
• Some mechanical or cosmetic defects and needs servicing but is still in reasonable running condition.
• Clean title history, the paint, body and/or interior need work performed by a professional.
• Tires may need to be replaced.
• There may be some repairable rust damage.
• Severe mechanical and/or cosmetic defects and is in poor running condition.
• May have problems that cannot be readily fixed such as a damaged frame or a rusted-through body.
• Branded title (salvage, flood, etc.) or unsubstantiated mileage.
Kelley Blue Book does not attempt to report a value on a "poor" vehicle because the value of these vehicles varies greatly. A vehicle in poor condition may require an independent appraisal to determine its value.
Armed with technology, smart buyers have a clear knowledge of the car’s title, condition, and true market value and they’re using that information to guarantee they get a great deal and avoid becoming one of the horror stories.