If you are staring at a car payment that looks more like the national debt payment of a small country, then you definitely need to know about a different option. Or, if you are in the market for a car, but just can’t stomach taking on a payment for something that is going to lose value the moment you drive off the car lot, then you definitely need to look at the options presented at Car Auctions.
There are many benefits to buying a car in this manner, but the number one reason in my mind is that you do not pay retail for an item when that same item can be purchased for much less. All it takes is a little bit of time, patience, and research and you could eventually end up with the car of your dreams for a fraction of the price.
Buying from an auction is much different than buying from a dealership. At a dealership, you will most likely deal with a few employees of the company, like the sales person and credit manager. You will not have another person looking at the same car trying to outbid you for the car you want. Can you imagine being at a car lot, trying to negotiate a deal that is a couple thousand dollars off the sticker price, only to have a guy come up and shout, “I’ll give you $500 more!”
However, at a car auction, with several people present to bid on the same vehicles, that scenario could happen. If it does, it would be a good idea to have a plan about how to deal with it. Now, I don’t mean have a plan, as in take the guy around the tool shed and let him know what you think about his offer! I mean be prepared by knowing exactly how much you are willing to pay for that car and don’t offer more. You may not get it, but guess what, the deals and opportunities are out there all the time. So, if you don’t win the bid on this car, then there will certainly be another coming up that will match your needs and fit your budget – maybe at the same auction, or maybe at an upcoming auction. This is where your patience will be tested.
So how will an auction allow you to purchase the car of your dreams and never have a car payment again? Well, it’s a really easy system with a couple of different methods. One guy I know would buy a car at auction for under $1000 and pay cash for it. Then, he would drive that car payment free for about six months, but during that time would set aside the amount that he would normally have to pay for a car payment. So, in our example, let’s say that he set aside $300 each month for a total of $1800 saved over a six month period. Before the next auction, he would sell his vehicle. Since he purchased wholesale, he may be able to easily sell that car for $1500. Now, at the auction, he has $3300 to spend on a vehicle. This time, he purchases a car that may be a little newer or have lower mileage. He then does the same thing, drive that car for a period of time while he socks money away. In time, he is able to buy his dream car, at auction, through a private party, and sometimes even at a dealership but on the best terms – not retail! And the best part is that he pays cash and has no payment.
Anyone can do this. You may discover that you are able to negotiate better deals when you are dealing in cash rather than working out a deal with finance and trade-in considerations as you do during a typical dealer transaction. Don’t get me wrong, I have nothing against car salesmen or even dealerships…I just have a problem with paying retail for something that loses resale value the moment you drive it off the lot! If you want to consider the auction method to build up your cash position so that you can get that “dream car” and never make a car payment again, then be sure that you are armed with reliable inspection methods and a good source of auctions in your area.