Things To Watch Out For When Buying A Car At An Auction


Nov 24th, 2020

Things To Watch Out For When Buying A Car At An Auction

One misconception most people have about car auction sales is that the cars sold there are problematic. That is so not true! There are several reasons dealers sell their cars at auctions. Some dealers take inexpensive cars to auction to make space for more profitable vehicles. Others would only want to rid their garage of a car that had been there for a while and make cash from it.

Please don't shy away from buying from an auction. However, if you notice the car has been sold at auctions more than once, avoid it. There's more to it than what you see. Hear us out!

Is it safe to buy a car at an auction?

Yes! Buying cars at auctions is safe. Car dealers often source cars from auctions. Car dealers in Australia who buy their cars from car dealer auctions need to be licensed.

Different types of car auctions

There are three types of car auctions:

  1. Car dealer auctions - These auctions (also referred to as closed auctions) are open to licensed car dealers who buy cars in bulk then modify and resell them. Interested car dealers can explore this option but need to know that getting a licence is a long and tedious process. Each state has its own set of requirements that a person must meet to get a dealer licence, one of them being a set number of cars they buy and sell each year.
  2. Public auctions - These auctions are open to the general public. Cars sold here may be bank repossessed, from lots, trade-ins, and some high-end cars and SUVs.
  3. Government auctions - Government agencies, including the police, will often get rid of their old vehicles as they aim to upgrade. They dispose of their cars in auctions open to the public. They also sell some cars impounded for traffic violations or those used by convicted criminals to commit crimes. Government auctions are highly competitive. 
  4. Online auctions – This type of auction is a growing trend. You will mostly find used cars. As a prospective buyer, you will have to sign up and make your bid like a typical auction.

What should I know before buying a car at an auction?

Choose the right auction

First, decide on which auction you'd want to participate in. Car dealers should go to a car dealer or government auction. Individuals looking for cars for personal use should go to either the public auction or government auction. But for government auctions, you should know you are going to face expert competition. 

Sometimes you may want to survey attending the auction. Some public auctions are free, while others require a nonrefundable fee. Is it worth paying fees and not buying? That is up to you. But it wouldn't hurt if you see it as a means to an end.

If you're new at this, observe before you bid

The best purchases are made after thoughtful considerations. When buying a car from an auction, especially if you are a newbie, the best thing to do is take a step back and observe how expert bidders go about the process. Listen to what the auctioneer says, and observe how the buyers behave. This will guide you: you know when to make an offer and when to hold back.

Assess the risks

The main objective of buying in an auction is getting the best deal. That's why you should assess the risks that may come with the purchase you want to make. If the information provided suggests that the vehicle has no known defects, then make the offer. Otherwise, if the car has issues but does not affect its functionality, proceed with caution. 

Bring your mechanic

You will not be allowed to drive the car, but you can inspect it. If you are not car-savvy, the best thing would be to tag along a mechanic. Of course, you should ask for the vehicle's inspection report, but the mechanic is the third eye. He will reveal information not included in the report, which will guide your decision to buy or not to buy.

What should you not do at an auction?

Do not overbid

You are there to get the best deal. Get your emotions in control. Do not let over-excitement cloud your judgment. You could bring your spouse or a friend to help keep you in check and ensure you do not go over the budget.

Watch out for shills

Some dealers will want to drive up the prices of their cars. So they will act as bidders, mention outrageous prices, and wait for you to match them. Again, do not let this sway you to go over your budget. Stick to it! If you are not successful, there's always another day. Did I mention you should have at least two cars on your radar? This keeps you on level ground. 

Poor signalling

Don't take your eyes off the cars you want to buy. Be vigilant lest you lose the bid to another person. Move swiftly, make your bid, and stick to it if it's under your budget.

Once you’ve gotten your car, have your mechanic check it for whatever needs attention. If you need parts for it, don't forget to source them through To use our Car Parts Finder, you need to fill out an online request-for-parts form. Our system will then send your request to over 500 auto parts sellers and wreckers who will offer you their most competitive price. 

In a way, we’re like the reverse of an auction – the sellers compete with their lowest offers instead of the buyers offering their highest bids. What about that? If you have questions, please feel free to contact us at!

By Eric Anyega