Cars do not respect the recession: they continue to wear out with use and as they age, they require more and more maintenance, even though the owner may have difficulty meeting these expenses and the need for a replacement car makes more sense with each passing day. The problem is that when even paying for the maintenance of the existing car is tough, how do you pay for a new one? The answer to the replacement car problem lies in wholesale auto auctions where you can often pick up great bargains at incredibly cheap prices. While the cars for sale will not be new, it is often possible to pick up a car that is in excellent condition and will need little in the way of maintenance expenses at incredibly low prices.
When people are unable to repay the loans they took to buy new cars, the banks and finance companies repossess them. The financial institutions need to sell of these vehicles to recover as much as possible of the remaining loan amount and they need to do it fast. Everyday that they do not get back as much money as possible means their losses keep increasing. Another headache for the lenders is that they will need to pay for the cars´ storage and also that the longer the cars are stored, the older they become and so the less their market value.
The lenders need to liquidate these assets as quickly as possible to cut their losses and the way they do this is by wholesale auto auctions. The key to succeeding at a wholesale auto auction is to understand that the lenders are in a rush to get back as much of their money as they can and will not hold back a car even if the last bid is far lower than the market value and that is why those who attend these auctions regularly keep their bids low knowing that if they miss out on one car, another will soon come along. But there are pitfalls in buying from a wholesale auto auction: you have no warranties on the conditions of the car you are bidding for. People who are unable to repay their loans are often also unable to maintain their cars properly and while they may look good, their mechanical condition may be doubtful. Before bidding on a car at a wholesale auto auction it is essential to have the car checked out by an experienced mechanic to ensure that the buyer does not get any unpleasant surprises once he takes the car home.