Topic: Dealers Only Auction

[William_w]

What are the risk of buying a car at a Dealers only auction?  Are there any thing one should look out for?

I was offered by a used car dealer to bring me to one of these auctions.  He will charge me $500 plus whatever the cost for the car.  

Anyone has any experience?

[safristi]

You "were offered by a used car dealer" ..I'll bid $23.99..if'n you'll do my dishes and scrape ice/snow off my car and wash it fer a year...!!!!

[Sterling]

Most of the cars on a franchised dealer's used car lot come from these auctions. They are mostly ex-rentals. I assume the car you're looking for is a late model 04 or 05? The risk is the same as with buying any used car except that instead of getting hours (if you want) to look it over, you get maybe 30 seconds.

[William_w]

I have scanned over the inventory listing.  Most of them are either ex-rental or 2-3 years old car from leasing companies.  I'm still debating whether to go this route, I'll probably be able to better tell after I see the Dealer on Monday and hammer out the details.

I guess the only pros about this is that I'll be getting the car at wholesale + $500.  The cons is I will not be able to examine the car before, and there is no recourse if I get a lemon.

[johngenx]

Lease returns being sold by finance companies can be great buys, and are usually in good shape.  But, remember that dealers do this for a living, and they usually re-auction "bad" buys.  You don't have that option.  Also, many dealers are familiar with the sources, and the "typical" condition from those sellers.

Where do you think all the captive financing arms sell their lease returns?  At auction.  It is your chance to buy a car at true wholesale pricing, but it's a bit of a gamble for a "one-timer" at these auctions.

[safristi]

Are you a gamblin' man OR do you wear Boxers & briefs....ya gotta know when ta hold 'em and when ta fold 'em..the boxers that is!!!!!.
     Nothing ventured nothing gained..how many really bad lemons are in the bunch...even the auction house wants to sell tomorrow...capice???

[William_w]

I went to visit the dealer this morning.  I was told the auction that he is going to will be at Montreal.  And the model that I'm looking for (2002 Ford Focus Wagon) are consigned by Ford Canada Credit Limited.  

That's the plus.  But things went downhill from that point on.  Instead of the $500 fees that he mentioned on the phone, now he wants $1000, but that will include safetied and emission test and any necessary repair to get the car saftied.  Furthermore, there is an auction fee of $325 plus transportation fee of $150 from Montreal to Ottawa.  So all of a sudden, I'm looking at wholesale + $1475.  

I was kind of willing to roll the dice, because after adding his fees, I figure I'll probably be spending approx the same amount as if I were to buy a similarly equipped car from a Ford Dealer, except the ones at the auction has 25000 km less than this one sitting on the dealer's lot.  

I changed my mind about the whole thing when the dealer asked for $500 CASH as a deposit and he would not accept any other form of payments other than cash.  I understand why he needs a deposit, and I'm willing to give him in any other form than cash.  I am worried that he will just keep my cash, if he is not able to get the car at the price he promised he could get it for.

[eddy4]

William , with low prices on Ontario lots for these same vehicles why bother with all this "cloak and dagger" stuff . between Stratford and Hamilton there are at least 6 large lots that specialize in lease returns. Check the trader.ca website

[Sterling]

You know that most of the cars consigned by Ford Credit are ex-rentals right? The rental companies sell them back to Ford Credit who then auctions them to dealers. Although most rental buy-backs are currently 2004's and 2005's so it may be a lease return.

It sounds like you just got a quick lesson on what it costs a dealer to sell a used buy-back. That auction fee and that transportation charge sound right on the money. Once you take out the cost of the safety, any repairs, and the emission test, there won't be a lot of that $1000 left. Clearly he wants the deposit to ensure that you won't back out after he has bought the car. I highly doubt that by cash he means five brown ones. If he is asking you to hand him money personally then you should run away. I'm guessing that by cash he means some form of payment that can't be cancelled like a personal cheque or a phoned-in Visa number.

[William_w]

Actually, he asked for five brown ones, no other form of cash accepted, and directed me to the nearest ATM.  And he told me the reason why he is asking for cash is he does not want the transaction to appear on his bank statements.  That's when I decide to back paddle.

[Sterling]

Yikes! Good call to cancel the transaction then. So the guy wanted you to hand him $500 personally? That would be a firing offence at any legit dealership.

[safristi]

Name two.?...

[William_w]

I called the Ford Dealer that I had dealt with, and apparently they can offer me a similar deal.  ok, $300 more than what the used car dealer is charging me.  I've decided to go with the Ford Dealer instead.  The reason is the sale will be subject to my approval of the car.  Plus the fact that I do not have to pay any deposit.  So in a sense, I know the dealer is only going to pick up the car if the car is good value to him.  If he over bids, or the car turns out to be a dude, he may get stuck with the car.  

So there may be a happy ending afterall.  I'll keep you guys posted.

[William_w]

Just to keep you guys updated.  The car that I want to get on auction end up being sold at a near mint condition of the Black Book price.  And it was way over what I had hope to get it for.  Oh well, I guess back to square one and more research.  

[safristi]

"Square One" has specials on thongs this week..only flossed once....