What Really Happens at a Car Auction?
Let’s start this article by first telling you how to register for an auction, for you will not even be there to witness or participate if you aren’t registered.
Before the auction
On the morning before the auction, you would need to bring along your driver’s license and fill up the Buyers Registration Form. A bidder number would then be given to you upon completion of the registration. This number serves as your identity during the auction.
During the auction
The vehicles will be lined up and sold in the numerical order of their lot number. The auctioneer will announce the terms and conditions of the auction before the start of the auction, and then it begins. All vehicles have a reserve price that is determined by the government or the body that conducts the auction. The bidding starts at a figure and usually increases in amounts of $100, $200, $250 or $500.
To bid, simply raise your bidder’s card until the auctioneer or his “spotters” acknowledge you. This continues until someone makes the highest bid that no one else wants to top.
After the auction
This is assuming that you are the highest bidder, else you may just go home! Three outcomes can happen at an auction. If the bid reaches the reserve price, it is then sold to that highest bidder. If it doesn’t but fall just short of the reserve price, negotiations will take place between the owner of the vehicle and the highest bidder. This process is called a referral. The highest bidder has the option of buying the vehicle at the reserve price. While waiting for an answer on the referral, you may continue bidding for other vehicles at the auction.
What if the highest bid is much lower than the reserve price? The vehicle will not be sold to the bidder but instead will be passed in and be auctioned once again at the following auction.
If case number one happens and you are the highest bidder whose price falls above the reserve price, you are one step closer to driving home your car. You need to pay a deposit by either a bank cheque or cash on the fall of the hammer. You then have 24 hours to settle the balance by either cash, cheque or through your financial institution. But if you have enough to settle the entire amount, you can drive the car home right away!
This article was prepared on behalf of YourNextCar.info, an authority website in government seized cars. Visit the website to learn more about how to win in car auctions.
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