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How to Make Money at a Government Car Auction

Posted by on December 18, 2011 in Uncategorized - 1 Comment

In todays economy, there has become a huge demand for second hand vehicles from government auctions, especially when there is a way to get them at a really good price. many companies are now offering ways to find these government seized vehicles, helping people connect with cars they may have otherwise had no chance with. These auctions are generally he’d at local DMV’s where the auctions are done on a “blind hope”. What does this mean to you, and how can you be sure that the car you are getting will help you make money, or enjoy?
Know the cars (spy)

lexus-is-250

lexus-is-250

One of the mist important things to do before you hit the auction, is to know the cars that have been seized. This is extremely hard to do, as people are not allowed to see these cars prior to the auction happening. So, how can you find out which cars are being auctions at the government auctions? Simple track the towing. A seasoned car auctioneer spends his days of work outside the towing office, waiting to see which cars have come in. Keep a list handy, and remove any cars that leave the facility from your list. Any car that is there fore 30 days is likely to go up for auction. You will have intel that nobody else has; this is a revolutionary way to get insight on which cars are going to be on the lot. Once you are able to keep a track of which cars are likely to go up for auction, you can do some research on KBB.com to see what the value of the car would be as either as salvage title, or a clean title. If the car is a salvage, know that even if the car has value, it is hard to sell the car as people are afraid to buy a salvaged car from an auction or used car dealership.

Keep a strong database

As you continue to “spy” on the vehicles coming in, keep a database of all VIN numbers of the tows, all of the make and models, and use this information as a way to find a good purchase. The database will eventually consist of 100-200 cars that will go up for auction at the DMV or towing office you are shadowing, so be ready for some hard work. Once you know your database is ready to go, and you know what is going to happen at the auction, go ahead and export your database to a bulk VIN checking service, such as KBB or cars.com. This will help you see if there are clean titles, or salvages, or if the car is stolen etc.

The Lazy way to make money flipping cars

Bring some cash and update your intel

Auctions are based on cash; you will needs lots of it. You will also need to know exactly which cars for auction you are interested in before the auction stars. Bring a printed version of the database that you have compiled over the time of the “spy” phase, and check off all of the cars that appeared in the auction previewing. The viewing time is extremely helpful as you can jot down the mileage that the cars have, and you can also get a closer look at the interior and exterior to see if there  is any damage you may not have noticed when the car was initially towed. You are now better prepared that likely most of the people at the government auction, and you should be good to go on your bidding. Keep in mind that this is an original method that I have devised myself, but others may have already been doing this.

Bid away!

Here are a few guidelines that you should think about before going ahead with your bidding on a vehicle.

1. What is the make and model of the car?

used-cars

used-cars

The make and model of the car will likely be ready for you on your database you have prepared for yourself. This is one of the most important things to consider when you are trying to flip a government seized car at an auction. Typically, the more luxurious the brand, the harder the car will be to sell, but the more money you will be able to make on the sale.

2. Are these cars the type of vehicle that historically is strong in a used car market?

The make and model is a strong factor when it comes to how easily you will be able to sell the car you have just bid on at the car auction. Historically, for example, toyotas and Hondas tend to sell better as an older car than an Audi, as most Audi consumers are looking for the newest and latest. Although used Audi’s are sold, and quite well, Toyotas and Hondas will always have more potential buyers.

3. Bid 50% of what you want to sell it for

You are here to make money right? You will no doubt run into some sort of repair that the car will need, and you will need to take that into consideration before purchasing your vehicle. If you know based on the database research you did before buying that car that the specific car you are bidding on is worth $5,000, don’t bid any higher than $2,500, as you will need to leave a lot of room for repairs. If you work off the 50% model, you should profit somewhere in the 25-40% profit range, which can be huge depending on the amount of cash you have available for investment.

Happy bidding!

 

Yosef Adelman on Google+

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1 Comment

  1. Jasmin Lopez
    Posted December 28, 2011 at 7:21 pm

    Thank you for the information. This article was helpful.

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