Buying a Damaged Car at an Online Auction

Learn how to save hundreds to thousands of dollars on your next vehicle

Many families have been affected by the recent recession, leading to budget cuts and a demand for used cars and parts. Online auctions present many high-quality cars and parts at less than half the cost of retail-sold items. Salvage car auctions make vehicles with little to major damages available without the hassle of purchasing from a dealership. Today’s dealers have become masters at tricking customers into overpaying. Some families turn to junk yards for cheaper options, but they will never know the vehicle’s history.

Recycling used cars and parts through online auctions allows customers to repair vehicles in all kinds of conditions and for various purposes. Online auctions typically provide a Vehicle Identification Number, which allows prospective borrowers to research a car’s history, including any previous accidents, before making any decision.

1. Research the vehicle you wish to purchase

Today’s online auctions provide thousands of options to choose from. Most websites provide a search tool, where you can type “2013 Dodge Dart SE,” or whatever make and model you’re looking for. If you’re still deciding what vehicle is right for you, just browse through the website’s listed options.

Some salvage vehicles possess only minor damages, while others need complete overhauls. This allows customers to choose their own price; vehicles with more damages will have lower prices, and in turn can be a more cost-efficient option.

Ultimately, the cost of repairs is what customers should highly consider. Repair shops can place quotes on how much it will cost to repair a vehicle. Most online auctions provide multiple pictures of each vehicle to show bidders any possible damage. However, some vehicles can possess internal damages. Bidders should include internal damages in their budget before deciding on a salvage vehicle.

2. Place a bid

Upon extensive research of your desired vehicle, you should have a pretty good idea of what its value really is. When you feel ready to place a bid, keep a budget in mind and never overbid. If you win the auction, you will become obligated to pay for what you purchased. Bidding online is fun and exciting, but it needs to be taken seriously.

While the auction starts, don’t be afraid to bid early. This will show other customers that you are interested in an item and ready for any possible competition. Also, don’t forget to keep checking on your bid. If you want to win the vehicle, you will need to continue out-bidding other interested customers.

Placing a bid in an online auction implies that you are offering to purchase a vehicle at the price you are specified. If the seller decides to accept the highest bid, you will be contractually bound to purchase the vehicle if you are the highest bidder, along with any additional auction fees. Sales are typically final and the bidder holds no right to any refunds or exchanges.

Salvage online auctions often sell vehicles on an “as is, where is” basis, meaning that the highest bidder will purchase the vehicle without any warranty or guarantee. This leaves the research process up to you; make sure you are comfortable purchasing a vehicle before placing any bid.

3. Receive the vehicle

Upon winning a vehicle, the auction company will notify you with an invoice. You will most likely be obligated to make a payment within the next business day. The invoice will include auction fees, transaction fee and the final sale price. After you have made the necessary payments, you are the official owner of the vehicle.

Some online auctions will arrange quick and convenient shipping directly to your driveway. There is no reason to worry about the safety of your vehicle, as it will be in the hands of licensed, bonded and insured transporters. It is better to arrange shipping as soon as possible, because some auction lots will charge storage fees, if the vehicle remains at the facility. After the vehicle is paid for, it is now your responsibility.

If you are able to pick up the vehicle yourself (if the auction is in the U.S.), it is likely that you will not be allowed to drive the vehicle off the lot, regardless of its driving condition or title status. Make sure you are able to tow or transport the vehicle in a carrier.

4. Repair and inspect

When a salvage vehicle is delivered to your home, you will not be able to drive it right away. Not only is it unsafe, but it’s illegal in many states to drive a salvage vehicle. The car needs to be repaired and inspected by a professional and have a title change.

If your salvage car has no damage at all, it was most likely a theft-recovered car. The following states use salvage titles when a car is stolen: Arizona, Florida, Georgia, Illinois, Maryland, Minnesota, New Jersey, New Mexico, New York, Oklahoma and Oregon. Check your specific state’s requirements to determine what needs to be done before you can drive a salvage vehicle.

Depending upon your state’s law, you may be able to change the title of your vehicle to a “rebuilt” or “clean” title. In order to do this, your car will need to be inspected. Keep any repair receipts to bring to the inspection. The purpose of a salvage inspection is not to confirm road worthiness or the quality of repairs, but to verify the vehicle’s ownership and required documentation.

Safety inspections are separate inspections, which check the air bags, bumper, dash, deck lid, doors, engine, frame, fenders, hatchback, hood, rear door, rear quarters, transmission and other components. To be driven, vehicles must be completely rebuilt and made highway operational. With the proper repairs and inspection, your newly purchased Dodge Dakota or Ford Focus will be ready for the road.