Used car dealer auctions, any experts?

[lendaddy]

I have a guy that's gonna get me into a couple dealer auctions for a nominal fee. He gave me a market report from one of the auctions that showed all sales prices for the previous two weeks. There is indeed some cash to be saved here. Anyway, I need 2 trucks, and an SUV which is what led me to find a cost saving option. The prices seem to be right around trade-in value at KBB, is this normal? 4x4's are a little higher due to the season and sports cars lower for the same reason. A '99 911 coupe with 53k went for $28k and a '00 Boxster same miles went for $18k.

Soooooo.... why am I not buying these and reselling them since the guy only want a couple hundred for the trouble?

[Rot 911]

I've often wondered about how much of a hassle it would be to get a dealer's license and just start going to these auctions.

[Mike(dat's me)]

I believe the rule in Texas was, if you sold more than three vehicles in a year, you had to have a dealers license. May that apply?

[lendaddy]

If anyone wants examples on what they get for certain cars at auction I'll gladely post em.

Example:

'03 Ininity G35, 45k miles loaded - sold @ $18,600

[RickM]

I have a couple of friends who own new/used car dealerships.

From what I understand the auctions around this area are very fast paced and not an environment to jump into as an amatuer. This venue is utilzed for the offloading of less than desireable cars....as you can imagine.

If possible go with a seasoned buyer and see how it works. Obviosly the more mechanically inclined your are the better, so you can do an on-the-spot PPI.

In NJ (or is it PA?) to resell cars legally you must have a commercial space specifically intended for this purpose, insurance, licensing and fees to enter auctions.....this can really add up.

On the side, it's a great source of income...used to do it myself.

[lendaddy]

Rick,

First, one of the auctions has 24 service guarantee. If you find any mechanical flaw within 24hours they fix it, this could be AC tranny, brakes, etc..

Second, I would not be the dealer or the buyer. I would simply give the guy a list of vehicles I was interested in and he would phone me from the auction when they pop up. I would then have to trust him (up to my max amount) with his bid. He would then own the car (with my money) until I sold it. He as a dealer would take care of sales tax plates, etc.. I would then give him a preset amount for his trouble as well as a % of profit to cover his income tax. I would legally not be involved.

[SteveStromberg]

You have to be ready to eat a few cars that will turn out to be lemons.
For a dealer turning over a couple of hundered cars a year a few lemons is not a problem.

[lendaddy]

Originally posted by SteveStromberg
You have to be ready to eat a few cars that will turn out to be lemons.
For a dealer turning over a couple of hundered cars a year a few lemons is not a problem.

This is true, which is why I would want a good man inspecting. Even then there is risk, there always is.

[Joeaksa]

Worked at an auto auction while putting myself through college. Lots of money to be made there but you need to be good with investigating cars quickly as they roll them through pretty fast. You can look at the cars before they roll through the auction area but not drive nor run the car.

Would be worth a try if you have a place and interested in tinkering.

JoeA

[RickM]

Joel, sounds like a great set-up....I'd probably give it a try.

What type of odometer tampering guarantee? I know of someone who purchased an auction car and later found the odometer reading didn't match what was stored on the computer. He was able to return for a full refund from the seller at the auction.

[lendaddy]

Originally posted by Joeaksa
You can look at the cars before they roll through the auction area but not drive nor run the car.

JoeA

Actually you can test drive all the cars here. Plus...get this, one of the auctions is literally next door to me. I have done AX's in his parking lot with the local P club I just never really thought of this.

[lendaddy]

Originally posted by RickM
Joel, sounds like a great set-up....I'd probably give it a try.

What type of odometer tampering guarantee?

Don't know there, I'll look into it.

[JavaBrewer]

A friend hooked me up with a broker and I tagged along to the auto action in Oceanside (off the 76). It was fun looking around, loads of vehicles, and you could sit in them and start them. I was looking for an F150 truck and there were ~ 30 available but only one that I was interested in. It ended up selling for $200 over the max I previously set with the broker. I was bummed until I found a private party F150 that was nicer and cheaper than the auction truck. There are lots of PP used cars right now - don't discount them too quickly. Prices are negotiable, you have a chance to really look them over, and you meet the PO (good or bad).

[red-beard]

I used to date a woman who's husband did this for a living. Will that help?

[AMERICAN]

I have purchased several vehicles at auto auctions. The laws governing auto dealer license vary state to state and even county to county. There are many different auto auctions. Some are very reputable others are for the professional, more low end cars but there is money to be made here. Example: Some auctions sell certified cars. This auction will actually inspect the car and certify it. Others will offer an inspection for a nominal fee, and any serious "undisclosed" damage discovered during the post sale inspection will void the sale. This inspection is done before the car leaves the auction lot. I would recommend searching auto auctions on the web and see what types are available in your area. I always go to the auctions the day before the sale, review the cars check wholesale values, make notes, look the cars over from top to bottom and follow it thru the sales process. I have a high price in mind and I don't go over it. I may have 10 -15 cars I plan to follow. Most auctions I attend run multiple lanes 1- 5 or more. This requires work. Oh yeah the juices are flowing you will get excited but keep your head there is always tomorrow. If you are buying late model vehicles check in the glove box and see if the car is still under factory warranty. Later you will start checking the gap distance between body panels and doors, but if you buy certified vehicles fromnational auctions this won't be as big an issue. Also if you are buying from a rep over the phone ask to preview the cars with him the day before the sale. Some auctions will sell you a spectator pass you just can't bid.

Most buyers use the NADA Used car buyer guide, available only to dealers or the black book. The NADA books and Kelly Blue Books we use are not the same.