How-to Guides » OLD GUIDE Buy a car for less

Buy at an auction

3 tips on this task  |  Tweet

1) Choose a reputable auction company
Auctions aren’t the back street affairs they used to be – they are now multi-million pound businesses.

If you are looking for a specific vehicle, look for auctions that list their catalogues on their websites beforehand.

2) Research how the car auction process works
You’re buying a car ‘as seen’. Although some vehicles do carry warranties against major defects and false claims, you sometimes have only an hour or so to detect the fault and notify the auctioneer.

It helps to read the small print as to what constitutes a major fault, and take the vehicle for a test drive as soon as you can.

3) Be aware of the hidden costs

The price at the fall of the hammer isn’t the only cost you pay: at British Car Auctions, for instance, there’s a buyer’s fee of £244 for a vehicle costing £3000, which rises by £5 for every additional £250.

This ‘levy’ is how the company indemnifies buyers against cars that prove to be stolen property, the subject of outstanding hire agreement, having a false mileage reading, or being an insurance write-off.

4) Take title of the vehicle as soon as you can
At British Car Auctions, a storage fee of £17 + VAT is chargeable for each day or part-day the vehicle remains uncollected. Other auctioneers have similar fees.

So not only are you paying out more money, you can’t test drive it until you own it, and meanwhile it’s sitting there in the compound at your risk, not the previous owner’s.
5) Understand the payment methods
Car auctions used to accept cash, telegraphic transfer, or banker’s draft. Now you can pay by credit card and debit card as well. Research each, and the costs - there’s usually a handling fee for credit cards, but not debit cards.

On the other hand, to pay by cash, debit card or banker’s draft, you’ve got to have the money in your account. Be aware, too, that there’s often a requirement to pay a deposit once you have made the highest bid.

6) First, go along to watch, not buy
Once you’ve chosen your auction and researched the system and the costs, go along and watch. Don’t take any money, leave the plastic at home, and go and see how it works in practice.

Pick an example of the sort of car that you might be interested in, and follow it through from the compound to the hammer-drop -- this is your opportunity to listen to the car’s engine, ask the driver any questions, and generally make a judgement about whether you would feel happy to bid on the vehicle.

To get a feel for prices, and to avoid over-paying, take along a copy of Parker’s Guide to second-hand car values, available from most newsagents. Remember, this is a practice -- so that when you do it for real, you’ll be able to concentrate on getting a good deal.