Buying repossessed cars can be a great way to save money as buyers often buy cars lower than their fair market value, making them a good option for those wanting to save money. However, buying repossessed cars can be tricky, especially if you are not familiar with the tricks of the car trade as well as making sure you’re covered with the best insurance policy available.
The biggest aspect of buying a repossessed car is that you use caution. Lenders often repossess cars when the car loan payments have been declined or defaulted on. The lenders often only make a profit based upon the interest amount built up on the car, this means that the lenders will work with the owner to make money for both of them, leaving you at a disadvantage.
What does this mean for you? Where the owner has not been able to maintain payments, this means that the car has been sat there with a lack of maintenance and building up wear and tear. This can include: a lack of oil and fluid changes or a build-up of rust – all of which leads to a shorter lifespan for your car.
For this reason, it is crucial that you inspect the vehicle before buying. There are couple ways in which you can do this to ensure you get your end of the bargain. Read below to see the top 2 recommended ways to buy repossessed cars:
1. Buy directly from the lender
If your bank union allows you to look at their repossession file, then you can get a good deal based upon how much the lender wants to recoup their losses. The lender may even offer financing of the car.
A downside of this is that the car is often presented in its original condition and so be aware of any faults which may be sold on.
2. Buy a repossessed car from a credible car dealer
Usually, a dealership will clean up the car, making it more reliable to be safe. The dealership may also offer a warranty service and in-house financing which means you are more likely to be in safe hands if anything was to go wrong.
However, the dealer still wants the highest profit and once the cost of transportation, repairs and detailing has added up, you are likely to be looking at a higher price tag than what you initially were expecting
