While you can find some great bargains at the auctions, you need to know the basics before you start bidding.
You will need to know what kind of auction it is and what it will cost you to complete the auction. Some auctions are open free to the public and others have an entry fee as well as a buyer's fee.

Some entry fees can be as much as $150 in the form of a monthly or yearly membership.

The buyer's fee is another way that the auction makes money from each sale. This fee could be $100 to $500 per purchase depending on the auction. You will need to check the rules of the auction before you start bidding. These fees may make the difference between getting a great deal and just buying a car that you could have bought for retail after the charges.

Make sure that the bid you make has enough margin for the fees and repairs that you will need to do to the vehicle.
For example: I went to a repossession auction and found a Chevy pickup that you would find at a car lot for $2,000. It looked solid, ran great, but it needed a new exhaust and a radio. I figured that the exhaust would cost about $150 and a radio could be installed for $50. I could save money by cleaning and buffing it myself.

This auction did not have an entry fee so I only had to pay $100 for a buyer's fee. The bidding started at $300 and I ended up winning at $600. It cost me about $760 with title fees, tax and fees. I added the exhaust at $125 and the radio at $50 so I had a total of $935 into the truck. This is a great deal! I drove it for about 6 months and then sold it for $1800. It had a cap on the bed and the person that bought it did not want it, so I sold it for $200. I made $1,065 and got the use of the truck for 6 months!

If you keep your bid well under the retail market price and are able to make a good assessment on the cost of repairs, then you can make some serious money or just find an inexpensive car to drive.

Following Are The Basic Types Of Auto Auctions:

• Wholesale Auto Auctions -Where dealers sell brands of cars that they don't normally sell or where they liquidate cars that have been on the lot too long. You will need a dealer license to attend this auction.

• Public Auto Auctions -. Some are held by dealerships and some are where a number of dealers bring inventories together to be sold to the public.

• Repossession Auctions - a repossession (repo) auction is where the banks bring vehicles that are in default to be sold to the highest bidder.

• Charity Auctions '" Autos are donated to charity and the charity sells them to the public.

• Police Auctions & Government Auctions '" Where government vehicles and some abandoned vehicles are auctioned off. Some autos are the ones forfeited from illegal activities. Open to the public

• Insurance Auto Auctions & Salvage Auto Auctions - Usually open to only to dealers and salvage companies, but there are some open to the public.

Wholesale Auto Auctions and Manheim Car Auctions
These are auto auctions for dealers only, usually run by Manheim car auctions, and the public is not allowed to attend. The cars at the Manheim auto auctions fall into these categories:

• Cars returned after their lease expires.
• Rental Cars.
• Brands of used cars that a dealer received as a trade in, but does not normally sell.
• A new "hard to get" model that a dealer may be able to sell over MSRP in the car auctions.
• Exotic cars or collector cars that dealers are trying to sell.
• Used cars over 4 years old that most new car dealers don't want on their lots.

How can you buy from wholesale auto auctions?

If you know a licensed dealer who can get into these auctions, they can get the advance list of all the cars they plan to auction that day. You can tell your dealer friend which car you want and how much you are willing to pay for it. Usually the dealer will likely want to add some profit to the purchase. They would probably like to do this since they would not have to floor plan (inventory) or finance the vehicle.

Public Auto Auctions

These auctions are held by dealers or groups of dealers that are trying to move inventory that is stale or vehicles that have been sitting on their lot for too long. In addition, they may want to move brands that they normally do not carry or move trade-ins that don't meet their quality standards. They will normally start bidding at the amount that they have invested or wholesale price. It is a good way to pick up an auto under retail but be careful as most are sold "as is" without a warranty.

Repossession (Repo) Auctions

A Repo Auction is where your vehicle ends up if you are not able to pay the bank for it. The bank, finance company, manufacturer, finance, or Lease Company will take possession of the vehicle that is pledged to secure the loan or lease.

In cases where the payee or lessee can no longer pay on the loan/lease, they will turn the vehicle over to the financial institution that holds the title. The bank or financial institution will take the vehicle to auction and sell it to the highest bidder. The sale price, minus any fees, will be applied to the loan/lease and the balance left is the responsibility of the payee/lessee. In many cases, the vehicle has to be forcibly repossessed by a repo company if people refuse to surrender the vehicle. If you ever find yourself in arrears of your contract, you should go to the bank or finance company and make other arrangements before you end up with a repossession. If you have legitimate problems that are making you behind, then they should be able to help you over this rough spot.

Repo auctions are open to the public and you need to look over the vehicles very close before bidding. If someone is having trouble making payments, then they are probably not keeping up the maintenance or fixing the vehicle when something breaks.ender the vehicle. I If you have legitimate problems that are making you behind, then they should be able to help you

Police Auctions, Seized Cars & Government Auctions
In police & government auctions, they are usually auctioning off government-seized vehicles, or decommissioned vehicles that the agency no longer uses. Sometimes you get a good deal, sometimes not. The other issue is that there could be title problems with confiscated vehicles. They could have been stolen, or used to commit a crime, so you should run a vehicle history report on them to make sure that you'll be able to take title on the close of the sale. At police and government auctions, remember that these vehicles are sold "As Is" with no warranty, so don't expect to buy a gem. You may have to do lot of work on your purchase.

Insurance Auto Auctions & Salvage Auto Auctions

These auctions are sometimes open to the public but most are open to salvage dealers. They do have some auctions for on-line bidding. If you have the skill to do body work or repairs then you can pick up some nice deals and save a lot of cash.

How dealers know how much to bid:

At the wholesale auto auctions dealers use their Black Book (Black Book, www.blackbookusa.com) which is a compilation of auction results for a particular area of the country. They give the dealer the best and current wholesale market value of a used vehicle. It is like a Kelley Blue Book or NADA book for auto auctions. (At some auctions, you can even buy a NADA book).

At the auction before the bidding starts, you can usually inspect the cars but you won't be able to drive them. Therefore, you will need to visually check it over and determine if there are any repairs that are needed. You have to figure out how much it will cost to fix it and deduct that amount from your black book estimate. Bidding typically starts way less than the published value. By using the Black Book, many bidders have a goal of what price range to shoot for, and usually end up bidding slightly less than the book value on a car.

What to expect at auctions
At the bidding area there are several lanes going at once, each with its own auction running. The auctioneer will have helpers in the lanes watching for your bid. As the car drives up the lane to be bid on, potential buyers will come up to it; you'll see several buyers looking over the car. They will sometimes open the hood and trunk to check for signs of body damage. Make sure you have looked over your potential buys before the bidding starts.