If you’re shopping for an affordable vehicle in decent condition, you don’t have to settle for a pricey used car. Another option is a repossessed vehicle, or one that was taken away from its previous owner for defaulting on the loan.
The nice thing about shopping for repos is that they don’t have any upcharges. Buying a used car from a dealership is still expensive because it has been cleaned, repaired and inspected by a mechanic. Repo cars are sold as-is, which is reflected in the price.
Below are the steps you should follow when buying a repossessed car, truck or other vehicle.
Choose who you are going to buy from.
There are a number of ways you can purchase a repossessed vehicle:
- Lenders. Buying directly from a lender is the best way to get a great deal. Credit unions and banks want to get rid of repos and recoup their losses, passing on the savings to you. For a complete list of repos in your state, visit RepoFinder.com.
- Repo reseller. The benefit to working with a repo reseller is that they generally have some standard for the condition of vehicles they sell. You will pay more for these vehicles, but you can expect a better car.
- Auctions. There are all types of auctions online, though the majority are for used car dealers, not individual buyers. However, if you happen to find an online auction, make sure you register online and take a look at their inventory.
- Used car dealers. Used car dealerships do sell repos, but keep in mind that they will be more expensive. This is because the dealerships inspect the vehicles and fix them up before selling.
Determine your budget.
It’s important to establish your budget in advance. Most repos need some type of maintenance, so this will need to be factored into your budget. If you use all of your money to buy the car, you won’t have enough to make essential repairs. Like used cars, repos come in all price ranges.
Research the vehicles you want.
To narrow down your search online, research the best vehicles for your needs. Consider what features are most important to you, such as special cameras, sensors, tire pressure alerts and seating. Also research what car makes/models are most reliable. Generally speaking, repo shoppers do best with reliable, low maintenance cars that hold their value.
Place your bid.
Once you find a repo that fits your criteria, you can make an offer on it. We also recommend having financing in place, as this shows that you are a serious buyer.
Nearly all repo sites require you to be a member, which is why it’s important to choose how you’re going to buy your vehicle first. For example, when you sign up for RepoFinder Pro for just $4.95 a month, you get full access to our repo list and can place bids.
Inspect the vehicle.
If the seller accepts your bid, you can purchase the vehicle. We strongly recommend inspecting the repo before signing anything. You probably won’t be able to test drive it, but you can look at it for an overall assessment. Once this is done, you can sign the paperwork and take your vehicle home!
Buying a repo is fairly straightforward, though it does require more diligence on the buyer’s part. You won’t have a car salesperson showing you around and selling you vehicles, which some look at as an advantage, but you will be on your own. Use the online tools to your advantage, research the cars you’re interested in and inspect the repo before signing anything and you should be just fine.