How do auto auctions work?
Each auction site has different rules. In general, they work by taking bids, often out loud from the bidders present. To become a bidder, you often have to have established an account, or come with a cashier’s check, that is used as colateral, so the auctioneers know you are “good” for your bid. You can often visit the cars on auction, beforehand, and inspect them. You never know for sure how good they will run, that’s why they are so cheap. Also, prices are low, not because everyone wants them, but because the bidders are normally “professionals” and not many bidders show up at auctions who qualify to bid. They often are repossessed cars, or sometimes surplus trade-ins from auto lots. Because of the sparcity of bidders, and sometimes “collusion” among those present, bids are purposefully kept low. If a repossessed car doesn’t bring in enough money to pay off the foreclosed loan, the original buyer is still liable for the excess of loan. So, when you lose a car back to a bank, to be au
