Risks of Buying a Car from an Auction

In theory, a public auction is a practical means of securing a low-cost ride. It’s an attractive option for buyers who are short on cash, who don’t qualify for an auto loan, or who are simply bargain-hunting for a second set of wheels. The auction block is fraught with pitfalls, however. Layers of paint can mask a history of auto body woes, and those two innocent-sounding words, ‘as is,’ mean you have no legal recourse if you’ve bought yourself a lemon.


The atmosphere at an auction is very different from an auto showroom or a used car lot. Cars are sold by means of fast-paced, competitive bidding, and it can be easy to get carried away and bid more than the car is worth, thus defeating the purpose of attending the auction -- saving money. Know the Kelley Blue Book value of the car you want, set a sale price that you will not bid above, and stick to it. If the bidding gets out of hand, be willing to walk away from the car.

No Warranty, Sold 'As Is'

Cars at auction are sold without a warranty. That means that unlike most new and used cars sold through dealerships, if the wheels fall off when you’re driving it home, you can’t just take it back for a free repair. You are financially responsible for all repairs and maintenance once you buy the vehicle. In addition, cars at an auction are sold ‘as is.’ If you discover some serious damage that you missed at the auction, you have no recourse to sue or otherwise hold the car's seller responsible.

Seller Tricks

Be alert when buying at an auction, and give your car of interest a thorough inspection. Check the VIN number – the number on the windshield should be the same VIN number as the one found on the rest of the car. Check the interior for water marks or a musty smell, both of which are indicators of flood damage. Observe the body of the car for signs of efforts to mask bodywork, like use of Bondo or excessive paint. Carefully pull the dipsticks – the fluids should all be clean and clear. Finally, if you see something that doesn’t look or feel right, trust your gut.

Cost of Repairs

Cars bought at auction are ideal for amateur mechanics. If you have tools and equipment for car repair and a knack for basic auto maintenance, you’re ahead of the game. Otherwise, consider whether the money you’re saving on the car itself initially might come back to haunt you in the form of expensive repairs later. Be aware of the repair issues that are typical of the model you’re buying, and before you make a purchase, determine whether you’re prepared to deal with the cost.

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