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There are advantages and disadvantages to purchasing a vehicle at a government or police auction instead of going to a car dealership. Many people don’t realize it, but the police seize thousands vehicles every month and in most cases auction them off to the general public at greatly reduced prices.

Government auctions are a well kept secret that dealerships would rather you not know about. They purchase these vehicles themselves for very low prices and sell them to the rest of the public for good profit. The more consumers become educated about police auctions, the more competition they face at the auction plus car dealerships sales they could potential lose that business.

Yet over 90% of the population still goes to car dealerships to purchase their vehicles. People are simply not aware of the great deals that police auctions have to offer. The government isn’t about to spend any budget publicizing the auctions either. Below is a list of pros of advantages versus disadvantages in buying vehicles at these auctions:

Pros:

- Business model is much more conducive to lower prices

- Police auctions are held everywhere in US and Canada.

- Information regarding government and police auctions with vehicle listing detail is now available on the web

- There is usually a wide selection of vehicles that can be found at government auctions - sports cars, SUV’s, pick up trucks, motorcycles, jeeps, etc.

- no distribution channel (car dealership) to go through or to pay

- No commissioned salesperson to have to deal with

- Motivated seller who doesn’t have the resources or time to deal with inventory, therefore offering vehicles based on no reserve bidding

- Better income tax advantage (can be set up as a business for resale to spouse, kids etc.)

- Usually pay less car taxes

- Start your own business (i.e. Sell cars on the Internet)

Disadvantages:

- Most sales are made in cash so credit is typically not offered

- No extended warranty beyond what the manufacturer offers. Most used dealerships give only 30 days

So if you don’t mind paying cash, or have access to credit, then it’s obvious that the pros far out-weigh the cons in favour of government and police auctions. Just as with a used car dealership it is a good idea to bring someone with you who can inspect and determine the vehicles condition.

Tags: Government