If you're in the market for a used car, someone else's financial misfortune could turn into a spectacular deal for you. Most auto loan companies try to re-sell the cars they repossess in order to recoup their losses. If they sell the car for more than the owner owes on it, the owner will get the difference. If it's sold for less than what's owed, the owner will have to pay. Either way, repossessed cars are often sold at considerable discounts off the Blue Book price and knowing how to buy them can save you a lot of money.
- Skill level:
Call local auction houses and get the times and dates of upcoming repossessed car auctions. Most repossessed cars are sold via auction.
Contact local banks and ask whether they sell repossessed cars. Rather than paying the expense of an auctioneer, some small lenders choose to sell the cars themselves, either through a website or through their own on-site sale.
Call local used auto dealers. Both new and used auto dealers sometimes put repossessed cars back on the lot. Ask the dealers you call whether this is the case and whether they can show you some repossessed stock.
Browse the local newspaper for listings of repossessed auto auctions. Many times, banks and auction houses will take out large ads in the interior of the paper or list the upcoming sales in the auctions section of the classified ads.
Make sure you bring the correct form of payment to buy your car. When you call businesses that may have repossessed cars to sell, ask them what methods of payment they accept, so you'll know in advance what arrangements you need to make.
Examine the car thoroughly before you make an offer to buy it. Ask for a vehicle history report, if one exists. Also, be sure to check under the hood, look under the car, and inspect the interior for defects. If it's possible to take the car for a test drive before making an offer to buy it, do that to get an idea of how the car sounds and handles on the open road.
Tips and warnings
- Be sure to take any car you're thinking of buying out for a test drive, and thoroughly examine its interior and under the hood, looking for subtle defects that may turn into big problems later on. You should also investigate the vehicle's history through a CarFax report, which you can get if you have the car's VIN number (see Resources below).
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