Buying a car at an auction can be risky. Vehicles are typically purchased as is and could have unpaid liens or a repossessed title. Therefore, you should always know the market value before bidding on a vehicle. There are also arbitration rights at public auctions, which you should be familiar with before purchasing a vehicle.
It is risky:
Buying a car at auction is a risky business. You may have limited payment options and end up paying more than you can afford. Many auctions require cash or an approved auto loan. This is only feasible for some people. Furthermore, getting an auto loan may be even more difficult if you have poor credit.
First, it’s important to know about the car you’re buying. While an auction may have a large inventory of cars, you need more time to examine them for defects. In addition, some auctions are filled with cars that could be more reliable.
Car’s condition may be unknown
If you buy a car at a public auction, you have a few rights that you can exercise. Some auctions are AS-IS, meaning the car’s condition may be unknown. If you have questions about a car’s condition, it is important to understand the rules regarding arbitration. For example, some auctions will not arbitrate when you have an odometer discrepancy.
Arbitration is an alternative method of dispute resolution, but it has disadvantages. First, the dealership is typically the one to designate the arbitration company. This can affect the impartiality of the arbitrator. Studies have shown that the dealership’s involvement can make the arbitrator biased in their favor. Also, mandatory arbitration can be expensive. Depending on the circumstances, arbitration fees may exceed the amount of any award.
Paying by check instead of cash at an auction
When purchasing a car at an auction, you should prepare a budget. The best strategy is to stick to a price range, and if you don’t get the car you want on the first try, you should regroup and keep looking for a model that suits your budget. Occasionally, auction houses will charge a “buyer’s premium,” which can either be a fixed amount or a percentage of your total bid. To avoid being caught off guard, prepare to pay with cash or a check that is verified. Visit link if you are also looking for car service centers near your home.