Repossessed cars are vehicles that were bought using a financing program or loan. When the borrower fails to pay the lending company or bank, the latter can opt to seek the court’s help to obtain a car repossession order. You can also go to local and online auctions. However, auctions can give you a lot of pressure because of the presence of other people looking for a great deal. Do not let their presence and bids affect you. Avoid overbidding. Make sure you have the details of the car’s value and condition when bidding.
Having Your Car Repossessed
Many banks and lending companies offer auto loan or auto financing. These aim to help individuals without enough cash but have a regular source of income to purchase an auto. They just have to pay the amount and interest to the bank or lending company on a regular basis. Failing to do so may alarm the bank and lending companies. The period before they send you a letter varies.
When you receive a letter from the bank or lending company, do not worry too much. Normally, the letter is just a reminder. They even offer solutions for you to avoid auto repossession. Coordinate with them for solutions. Ignoring them will just result to a court order, which allows them to take your auto. It is difficult, but still possible, to prevent having your car repossessed. The costs are also high. You will need a lawyer and may need to apply for a new loan, where approval is a bit difficult because of your credit record.
Buying Repossessed Cars
Do not mistake repossessed cars for seized cars. The repossessed cars are the ones taken from their owner by the bank or lending company because of failure to pay the balances. The seized cars, on the other hand, are taken from their owner by the government due to criminal offenses.
The bank’s repossession of a car may be depressing for the previous owner but it opens up an opportunity for you to own it at a lower price. Most banks would be willing to give the lowest price especially when no other investors show interest on a certain car. Their goal is just to take the amount they lent the previous owner and get rid of the car as soon as possible.
The repossessed cars are usually sold online. They can also be found in auctions. You can check with the bank or lending company in your area if you are considering repossessed cars. They may give you a list of available makes and models and information on their history. Take note that the banks cannot give so much information on the cars especially their damages so it is better if you will have a professional mechanic inspect it. Keep in mind that the repossessed cars are sold as is. It is better to know the faults and damages prior to bidding and price negotiation.
If you do not want auctions, you can also go to auto dealers. They normally get the used cars from auctions of bank repossessed cars. However, you will have to pay for their markup.