If you’re in the market for a used vehicle but need to stay within your budget, repossessed auto auctions may just be what you’re looking for. Every day hundreds of cars, trucks and SUVs are taken back because of non payment and this is where you can cash in. Find out why bank owned repossessed vehicles are an easy way to get a cheap used car.
What is a bank owned repossessed vehicle?
When a car owner fails to make their loan or lease payments on time, the bank or finance company will take back or repossess the vehicle. Generally the owner will be given the chance to catch up on their payments or to pay the vehicle off completely before it is taken. If the buyer can’t or does not want to make any more payments or pay it off, the lending institution will take the vehicle over and will then sell it to recover all or some of the balance on the loan. There are also instances where the owner will for whatever reason voluntarily return the car if they no longer want or can pay for it. This is called a voluntary repossession.
To get their unpaid money out of these repossessed vehicles, the finance company or bank will most generally sell them through a professional auction service. When the auction service sells the car, the bank then gets the money that the car brought at auction, and the auction company will take out a commission fee for selling the vehicle.
Auction prices can fluctuate due to the economy, the number of buyers and vehicles at the auction and the condition of the vehicle. The bank will want to recover enough money to pay off the existing loan balance and to cover the storage fees until the car goes to auction. They will also have towing fees to pay to the repo company that picked up the car.
With all of this in mind, the banks want to recover as much money as quickly as possible for these repossessed vehicles. The longer that the vehicle stays in storage and the longer it takes to sell it, the more money they lose. By sending these vehicles to an auto auction, they can get a fast turnaround and recoup some or all of their money. Sometimes the banks may not make as much as they would like on these auction cars, but it’s just a gamble that they take.
With the banks wanting to unload these automobiles fast, this means a huge savings for you because these cars, trucks and SUVs can be bought for up to 90% off of their retail value. Some of these repo cars will be barely used, in great condition and have low mileage. Many people buy new vehicles and then in a few months for whatever reason cannot make the payments. This means that a near new car can be bought at an excellent price at a repossessed car auction. Whatever the final bid is, that is what the vehicle will sell for. If there aren’t many bidders that makes it even easier for you to get your hands on a used car without paying a lot of money. By going to an repo car auction with many bank owned repossessed vehicles up for bid, you can save a lot of money and get a reliable vehicle.