Government Seized/Surplus Car Auctions

Repo Cars for 90% Off Retail Price !

Seized Cars for $200 !

Government auctions. Sounds like a terrific way to get a bargain car. How does it work? What's the catch?

In a nutshell

In short, various federal, state, and local government and law enforcement agencies regularly seize the possessions of bad people and auction them off. This can be anything from houses, jewelry, cars, boats, guns, and more. These are collectively known as "government auctions."

Banks and lending institutions also repossess property and automobiles from non-paying customers, and sell the goods through auctions.

In most cases, anyone can attend and participate in these kinds of auctions.

How it works
Government seized-property or repossession (repo) auctions are held all over the country at various locations and on various schedules. Typically an auction is held at a particular location on a regular basis — usually monthly or quarterly.

Obviously, these government agencies and lending institutions are hoping to get as much money as possible for their goods. But bargains can be had. Otherwise, the auctions wouldn't be as popular as they are.

Do your homework
You should always do your homework before you start bidding for automobiles at auctions. Know what vehicle you want, know its value (Edmunds.com), and knows its history (get a CARFAX Vehicle History Report using the car's VIN number).

You should be able to get Vehicle Identification Numbers (VIN) and mileage information from the auction administrators. Further, it's a good idea to have the vehicle(s) inspected by a mechanic, or do it yourself.

Many auctions have a preview period of about two days preceding the auction in which you can look over and inspect the vehicles. However, in most cases, you will not be able to drive the vehicle. And there are no warranties or guarantees, which is no different than most other used-car sales.

What's the catch?
As we've already mentioned, there are always some risks in buying at government auctions. However, you can significantly lower your risks by knowing what you're doing, knowing about the car(s) you want, researching your pricing, and understanding how the process works.

If there's a "catch" to government auctions, it's that there's competition in the bidding. If the car you want is popular and in good condition, you can expect other people, including used-car dealers in many cases, to be just as interested in it as you are. Competition and heavy bidding will drive auction prices up.

Winning and losing
You must be willing to bid and lose in any kind of auction. You must also be willing to bid and win, and be prepared to pay or finance within the required time set by the auction company. You can apply for a pre-approved used-car loan at your bank or credit union.

You can also lease your auction car through the services of LeaseCompare. This will give you the lowest possible monthly payments, lower than a loan. Just give them the information about the car and they'll tell you what it'll cost you to lease it from one of their lease sources, which are usually large national banks..

How do I find government auctions?
You have essentially two ways to get started locating auctions for your bargain car search.

1) First, you can do all the legwork yourself. Contact your local federal, state, and local government agencies to determine if they have auctions, where they are, and on what schedule. Contact banks and financial institutions for their auctions, if they have them. Contact auction companies who handle auctions for banks and other clients.

Some government auctions are regularly announced in national or local newspapers as part of the legal requirements for conducting the auction.

2) The second way of finding government auctions is through a service that does all the legwork for you. Fees for these services vary but typically range from $35 to $40.

AuctionsPASS and Cheap Car Search are services that provide nation-wide government and repossession vehicle auction listings and services.

These services provide directories of auctions all over the U.S., listing locations, types of goods sold, schedules, and other details. Most require a "membership" fee, usually about $35 that provides access to their data.

Don't expect a full list of specific vehicles, descriptions, and prices because this information changes every day — although some services provide more detail than others. Be aware that the claims these services make to get your attention are typically a little exaggerated.

Look for companies that provide a money-back guarantee in case you are not fully satisfied with their service for any reason.

One more thing
If you don't plan on taking a mechanic around with you to the auctions to inspect your cars, here is an ebook, Inspect Before You Buy, on how to perform the services yourself, with checklists and details of what to look for — and how to do it. It's written by an experienced ASE certified mechanic.

Also see our Cheap Used Cars article.