Going once, going twice, SOLD!!!
Buying vehicles from an auction is not a new thing at all. In fact it`s what certain second- hand car dealerships have been doing for a while to get new stock on to their show room floors for a cheap price. They then add a nice sized profit on to the vehicle and then sell it to you!
So how can you benefit from a second hand car auction? Well in a number of ways really, firstly buying a vehicle from an auction can indeed save you a lot of money. How much money depends on many factors, but generally members from the public make an average saving on certain vehicles of about 15 percent. There are some cases where people do get amazing deals and save as much as 40 percent on a vehicles retail price, but bear in mind this doesn't always happen. However there are deals to be found at auctions so it`s worth-while going to check out a few even if you don't bid on anything at first.
How does it work?
Most vehicles you see at an auction have usually been repossessed by the bank due to non payment from the vehicle owner. The sheer variety of vehicles may just surprise you!. When you go to an auction there are a few things you need to bear in mind even if you don't drive away in a vehicle. You will need to register with the auction company before you are able to place bids on vehicles. You don't need to register if you are just going to observe the auction and get a feel for how things work, which is what I would recommend first time visitors should do. To register at an auction you will need to take a refundable bank cheque or make a credit card deposit to the auction company. This amount can be any where from R3000 to R5000 depending on the auction company and is refunded to the customer if he or she does not purchase a vehicle at the auction. This deposit will not be refunded if you make a winning bid and then back out of the deal, so make sure you want the car before you raise your hand. Please note that most auction companies will not accept the deposit in cash or as a personal cheque. Further more you will need to provide proof of identity in the form of your id or drivers licence.
Vehicles that are on auction are not sold with a warranty and are sold "as is". This includes the vehicles standard motor plan which will no longer be applicable, however if you do purchase a vehicle at an auction that has low mileage and is a certain age you may be able to purchase a motor plan from the vehicle manufacturer. You will also not be allowed to take the vehicle for a test drive but in most cases you can request the vehicles key before the auction starts so that you can have a look inside or under the bonnet. You may also be allowed to start the vehicle to confirm that it is in fact in running condition. Remember to check the vehicle out as thoroughly as you can, you may even want to take a mechanic friend with to give his expert opinion as to whether you will be bidding on a "rotten apple" or not.
Please bear in mind that vehicles sold when the hammer drops, exclude Vat(14%) and may also be subject to a handling fee, so budget accordingly with this in mind. I will give you an example of how this works below.
Vehicles bidding price: R50 000
Handling fee: eg. R1750
Total thus far excluding vat: R51 750
R51 750 + 14% Vat
=R58 995
So if the hammer falls on your bid of R50 000 you will end up paying R58 995 so please bear this in mind when you budget, if the most you have budgeted for is R50 000 don't let the hammer fall at R50 000 or you will be over your budget by R8 995.
Payment for your winning bid must be completed one day after the auction. You must also collect the vehicle one day after auction or you will be liable for an extra storage fee. Auction companies do not do financing and will not accept cash payments on their premises. Payment can take the form of either a guaranteed cheque or EFT payments.
So you want to see what`s what when it comes to vehicle auctions?. I will list a few of the big reputable names in the auction industry that myself or friends have successfully used in the past.
www.burchmores.co.za/
http://www.blogger.com/goog_1819814427
http://www.blogger.com/goog_1819814427
https://wbo.wesbank.co.za/AuctionsWeb/index.jspx
So remember there are many deals to choose from, but do your homework, budget correctly and make 100 percent sure about a vehicle before you raise your hand to bid and you might just drive away in a great deal.
Happy bidding :)
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