GUIDE TO BUYING
Role of Vehicle Auctions
sector has for many years been a major contributory factor
to the success of the used car trade in the UK. Auctions
provide an important wholesale function to the trade,
selling in excess of one million vehicles each year. They
provide a fast and cost-effective option for selling vehicles,
providing buyers with ready access to large numbers of
cars. Vehicles are drawn from a wide variety of sources
including fleet and leasing companies, local authorities
and dealer part exchanges. Auctions act as agents, using
their skill and expertise to bring buyer and seller together.
Although primarily fulfilling a trade function many sales
are open to the general public. This leaflet is intended
to provide guidance to private buyers at auction.
buy from auction?
Over the last
ten years car auctions have become much more popular with
private buyers as organisations such as the Society of
Motor Auctions have sought to raise the profile of the
sector. There's no better way to save money on the price
of a car and it's great fun and surprisingly simple to
take part. Auctions offer a large selection of vehicles
to suit everyone's budget. Often these are well maintained
ex company cars complete with full service history and
warranties. And for the convenience of the buyer, most
auction companies segregate different vehicles into specific
types of auction sale.
It can also
be safer than buying privately where the legal redress
is minimal. Vehicles at auction are checked with HPI Ltd
or Experian's Car Data Check subsequent to sale to seek
to ensure that good title is being passed and that there
are no outstanding financial agreements against them.
Auctions are increasingly modern and well equipped, with
undercover viewing, restaurants and other facilities.
to choose an auction?
an auction to buy a car, it makes sense to choose one
that is a member of The Society of Motor Auctions, a division
of the Retail Motor Industry Federation (RMI). Established
in 1969, the Society represents a broad mix of membership
from the smaller family businesses to the larger national
has its own Code of Practice and Customer Charter, and
only accepts into membership financially viable companies
which can provide evidence of sound and accepted trading
are dedicated to providing a high standard of service
to their customers whether corporate, trade, or the motoring
public, and to providing a safe and professional alternative
for customers wishing to buy or sell vehicles.
from a member can also benefit from the Federation's Arbitration
and Conciliation Service in the unlikely event of a disagreement.
The RMI MOTORLINE
- 08457 58 53 50 (a local call rate from anywhere in the
country) - will help you find a member auction house in
your area. Most auctions also produce a monthly guide
giving details of forthcoming sales.
of buying a car through auctions is very straightforward.
Cars are displayed before the auction, and then driven
in front of the rostrum. An auctioneer takes bids from
the hall and cars are sold to the highest bidder. The
sale is complete when the auctioneer announces completion
with his hammer. Until then a bid may be withdrawn. If
your bid is successful you will need to go immediately
to the rostrum to sign to confirm your purchase, to give
your name and address and lodge a deposit. Proof of identity
may be required.
or without a warranty
To help the
buyer, cars sold through auctions are generally described
in two ways, either 'sold as seen' or as 'all good'.
'Sold as seen'
simply means that the seller may not have sufficient information
to make a full declaration of the vehicle's background
and does not necessarily mean that there is anything wrong
with the car. However it is important to realise there
is no redress once purchased. Older low value vehicles
are likely to come within this category.
on the other hand, refers to a vehicle that has a 'warranty'.
This is usually a one-hour major mechanical warranty covering
drive items such as the engine, gearbox and steering.
It does not cover exterior bodywork and trim, interior
fitting and tyres. This gives the buyer time to take the
vehicle for a full test drive to check that it is mechanically
sound. Such vehicles are sometimes referred to as being
sold "with trial" or "with no major mechanical
faults." However the seller may advise there is a
specific fault in which case the description will be modified
to include details of that fault.
are only warranted as accurate if so announced by the
auctioneer at time of sale. In all other cases odometer
readings are not WARRANTED or INCORRECT and should not
be relied upon.
a car through a motor auction, it is very important to
study the Terms and Conditions of Sale as these may vary
from one auction to another. Although the contract is
between the buyer and seller, most auction companies may
provide some protection for the buyer in the event that
a vehicle is not 'sold as seen' and is subsequently found
to have been misrepresented before the rostrum in terms
of a warranted mileage or age. The contract of sale can
generally be rescinded under these conditions, but only
subject to written notification of a claim within a specific
will do their utmost to protect your purchase against
any defect in title by checking with an appropriate data
reference agency at the time of sale, very occasionally
a vehicle may subsequently prove to be stolen property
or subject to outstanding hire purchase. SMA members give
protection against such an eventuality and may make a
charge to protect against such risks. The details of the
protection can be obtained from the auctioneer's Terms
and Conditions of Sale. The charges vary so you should
always enquire before buying if you are not sure.
Most cars are
sold with a reserve (minimum) price that the seller is
prepared to accept. If your bid is less than the reserve
but fairly close, your bid may be accepted provisionally.
The auction will then contact the seller to see if he
will accept your offer. It is important not to bid for
any other vehicle while the seller's decision is awaited.
Have your deposit
ready. The balance will need to be paid by cash, cheque
or banker's draft the next day as space at auction sites
is limited. You may be charged storage if a vehicle is
not collected. Most auction companies accept debit cards
(Switch. Delta, Solo) and a few accept credit cards but
subject to a fee.
used cars bear VAT it is not usually accounted for separately
and VAT is not generally added to the hammer price. Vehicles
referred to as "Qualifying Cars" and announced
as such by the auctioneer will have VAT accounted for
separately within the hammer price to enable a VAT registered
buyer purchasing the vehicle for a qualifying purpose
to recover the VAT. Commercial vehicles are subject to
VAT on top of the hammer price at the standard rate unless
From the fall
of the hammer, or the acceptance of your bid in a provisional
sale, the responsibility for the vehicle is yours. Accordingly
you must usually effect the necessary insurance arrangements
even while the vehicle remains on site unless otherwise
stated in the Terms and Conditions.
It is an
offence to drive a vehicle on the road without a valid
insurance, a current Vehicle Excise Licence, and MOT
Certificate if applicable
for buying at auction
1. Arrive at
the auction in good time and check out the vehicles in
the compound to see which meet your requirements. Always
try to give yourself a choice of vehicles.
2. Go with
a knowledgeable friend if you have little product knowledge.
There is not much time to check the car and no road test
is possible prior to purchase.
3. Check the
auction's terms and conditions of trade as these may vary
between different auctions. Some companies read out a
synopsis of the main conditions and auction procedures
prior to each auction.
4. Decide in
advance how much you are prepared to pay and remember
to take the buyer's premium or fee into account.
5. Never bid
over your budgeted amount - there will be plenty of other
cars from which you can choose. Buy a model you know,
since you will need to make an on the spot decision. You
will usually be able to view cars beforehand but can examine
the engine only when a car is started up and driven into
the auction area.
6. Read the
notice on the windscreen. All the relevant information
will be on it. Year of manufacture, make, model, if there
is any MOT, road tax, what the mileage is and whether
'it is warranted or not. In particular check that the
vehicle has not been an insurance total loss. Some vehicles
come with an Engineer's Report on the mechanical condition
of the vehicle, a copy of which is affixed to the windscreen
at the time of sale.
do not always spot unfamiliar bidders so make sure that
your bid is noticed.
8. When the
car comes into the hall to be auctioned, ask the driver
to open the bonnet and check the boot for signs of rust
the society of Motor Auctions pledge the following to
'best practice' in the industry
To be fair
to both seller and buyer
the buyer against defect in title
to the SMA code of practice
all staff are familiar with customers' rights under
To have an
easily identifiable procedure for the handling of complaints
access to an independent arbitration facility