Buying a car at an auction might seem intimidating at first but it can be a great way of getting a good car at a bargain price.
Thousands of cars are sold at auction every week, with around 10% going to private buyers. This guide will walk you through everything you need to know, and what to look out for, when buying a car at auction.
How to buy cars at auction
A day at a car auction can be both exciting and nerve-wracking at the same time. You’ll want to turn up early so you get a chance to look over any cars you plan to bid on.
Take a look around the car’s bodywork, keeping an eye out for signs of corrosion and damage. Check under the bonnet for leaks as well. While you won’t be able to test drive the car, most auction houses will let you start the car. Listen for unusual noises and keep an eye out for a smokey exhaust. Check out our handy used-car guide for what to look out for.
Once the auction starts, each car will be driven through the room in the order they appear in the catalogue. The cars are referred to as ‘lots’ at an auction, with each lot being given a number. You’ll want to take note of which number your chosen car is and listen out when it’s called.
The auctioneer will set a starting price, then people in the room will bid for the car. This continues until there are no more bids, and the car will go to the highest bidder.
If you’re the lucky winner of a car at auction, you then have to put down a deposit. This is usually either 10% of the car’s value or £500, whichever is greater. You’ll then be directed to the cash office to pay the remainder of the car off and finalise any paperwork.
Keep in mind that some auction houses are quite specific in which methods of payment they accept, so read up on this before you set off.
It’s your responsibility to make sure the car has tax and an MOT before you drive it away. You’ll also need some sort of insurance cover before taking it home.
Can anyone buy a car at auction?
You should be able to turn up at an auction, register and start bidding, as long as the auction isn’t closed off to trade only. That said, it’s worth visiting a few auctions first without buying anything.
This will allow you to get accustomed to the process of bidding at an auction and the way buyers behave. You’ll want to do this a few times before taking your wallet along with you.
How do I place a bid?
At a physical auction, the auctioneer will go over things like service history, MOT test and mileage, so you’ll want to pay attention.
Stand somewhere the auctioneer can see you and signal clearly when you want to make a bid. Subtle nods may look cool in films, but the reality is that these won’t always be seen and your bid won’t be registered.
Once the auctioneer has registered your bid, that’s when you want to listen out for rival bids. Raise your hand clearly if you want to up your bid, then once the price has gone past the reserve (the minimum amount the seller will accept) the car will go to whoever bids the most for it.
Will I incur any fees at auction?
Whenever you buy a car at auction, there will be a buyer’s fee to pay on top of the sale price of the car, so make sure you factor this in. This is usually around six per cent of the purchase price, but it can vary between different auction houses so do your homework before you show up.
What type of vehicles are sold at auction?
All kinds of cars are sold at auction, from rare vintage collectables to run-of-the-mill hatchbacks. A large chunk of cars sold at auction will come from national chains, such as ex-rental cars and ex-fleet cars. Dealers also use auctions to sell off cars that are too old or have too high a mileage to sell on through an approved used programme.
Repossessed cars can also be sold at an auction, so it pays to have a full HPI check done before you bid to make sure it’s not hiding anything shady. The same goes for Category D write-offs. You’ll need to find out exactly why it was written off and have evidence that any repairs were done properly.
Where to find upcoming auctions
There are car auction houses all over the country, and finding one near you is a simple case of searching for one online.
Some auctioneers will allow you to bid online in real-time, or you can use online-only auction sites such as eBay. This may be a convenient way of bidding, but you may have to go and pick the car up. Some places will offer a delivery service, but this can be costly.
Top tips for auction first-timers
There are a few things you can do to make your first auction experience as stress-free as possible, here are our 5 top tips:
- Go to a few auctions without buying anything first. This will give you a feel for how the process works and you’ll be more confident when you do it for real.
- Research the car you’re interested in before buying. Get an idea of what they’re worth and any common faults to look out for.
- Turn up early on the day. This will give you plenty of time to have a good look over any cars you’re thinking of buying. If you’re not mechanically minded, take someone who is. There won’t be a chance for a test drive so you’ll want someone with you who knows what to look and listen out for.
- Set a strict budget. It can be easy to get carried away when a bidding war starts, so set a limit on what you’re willing to pay and stick to it.
- Don’t take your catalogue into the auction room. Private buyers and traders are often given different catalogues, leaving you vulnerable to getting ‘bid up’ by a trader. This is when the trader will compete with you to drive the price up before dropping out, so you shouldn’t stand out as a private buyer.
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