Instead of going to a car dealership and buying vehicles the usual way, have you ever considered visiting a government or police auction? If you’re not aware, the police seize thousands of cars and other vehicles every month and often auction them off to the general public at extremely reduced prices.
In fact these auctions are a secret that car dealerships don’t want you to know about. An educated consumer could pose as a potential threat to at least a portion of their business.
So why does 90% of the general public buy from car dealerships? Well that’s a good question and I think it comes down to education. People are simply not aware or these government and police vehicle auctions. The government would be ridiculed is they spent money on advertising. Here is a list of advantages and disadvantages in buying at these auctions:
Pros:
- They’re offered at much lower prices than anywhere else
- No matter where you live, there are typically many auctions held around your area
- Detailed previews on the Internet of the cars and vehicles that will be offered at upcoming auctions
- There is usually a wide selection of vehicles that can be found at government auctions - sports cars, SUV’s, pick up trucks, motorcycles, jeeps, etc.
- No middle tier channel (middleman) to go through or pay
- No annoying commissioned salesperson to deal with
- Motivated seller who is not equipped to handle inventory, everything must go
- Possible advantages to income taxes (establish a business name)
- Car taxes are typically less
- Once you have an understanding of police auctions, you can start your own business (i.e. Sell cars on eBay or Autotrader.com).
Disadvantages:
- Most of the sales are cash only (any credit would have be done externally)
- No warranty period beyond manufacturer warrenty, although most used dealerships only provide 30 days or so
So if you don’t mind paying cash, or have access to credit, then it’s obvious that the pros far out-weigh the cons in favour of government and police auctions. Just as with a used car dealership it is a good idea to bring someone with you who can inspect and determine the vehicles condition.