Do you want to own a good used car without having to deal with professional car dealers? There’s another option for you. Go to your bank.
When we think of banks, we immediately imagine money, which is actually correct. Banks are engaged in the business of money, from savings accounts to loans. However, what many people don’t know is that they can also be into selling assets such as vehicles.
At first, it’s hard to imagine the relationship between cars and banks. But when you apply for a loan, such as a home or even a car loan, you need to have collateral. You can consider collateral as a form of guarantee to the bank: in case you default or fail to pay your financial obligations to them, the bank has the option to seize the collateral and do whatever they want to recoup the losses from the default.
But banks are not car dealers. It’s not their cup of tea. Further, when assets are seized and are stored, banks start to incur inventory expenses. These are costs associated with the maintenance of the vehicle to ensure it continues to have good market value once they sell it.
The longer the vehicle sits idly, the bigger the expense and the longer the bank has to wait to recover their losses. Thus, as much as possible, they sell the asset as quickly as they can.
Experts look used cars sold by banks as bargains, and here’s why: their price may be significantly lower than their average market price. You can potentially save as much as 50% to 70% than when buying the vehicle as brand-new or when compared to its trade-in value.
As much as possible, banks want to recover the losses, but they also want to see to it they attract plenty of potential buyers. Hence, the asking price is low, especially if the demand for the vehicle is also low.
Where to Find These Vehicles
Banks don’t sell these units at any time. Rather, they organize an auction, where many of their assets can be sold in one day. This means hundreds of cars will be available for potential buyers.
Banks may organize a public or a private auction. In a private auction, usually, only licensed car dealers will be allowed to bid and purchase the vehicles. These are the ones who purchase several cars at one time. There are also times when they open their auction to the public.
Banks may promote these auctions in their respective websites or in their offices. You can also be more proactive and search these yourself.
To save you time and effort, however, you can subscribe to auctions listings websites such as Gov-auctions.org. These websites have a large database of auto auctions in many states across the country, including those organized by banks.
By using listings, you can access thousands of auctions in one sitting. Some of these auctions may also be online, so you can start bidding without leaving your home or when you’re traveling.