You should always make sure you're covered with an affordable car insurance policy. We've put together a quick guide to help you find and buy repossessed cars safely and at minimum cost.
Lenders can repossess cars from the registered owners if the registered owners default on car payments. The LA Times reports that, depending on the laws in your state, a payment may need to be late for just a few days in order for a bank to file a levy on a car and send an order to repossess it.
Most states enforce a day grace period, however, before allowing lenders to repo autos. Also, most lenders would rather not take the car back because they depend on the interest paid on the loan to make a profit. They may work with customers for months trying to keep the loan going before the go so far as to repossess the vehicle. That means that by the time the repo man shows up to take the car, the owner has probably already skipped a few months of payments.
Many people who receive a notice of repossession from a lender use that opportunity to trash the car, shred upholstery, tamper with the engine, etc. Others may have been in dire financial straits for some time and have lacked the cash to keep up with basic maintenance on the vehicle since the time of purchase. There may have been no oil changes, fluid checks, new tires, etc. Any or all of these conditions take their toll on the vehicle.
For this reason, no matter which route you take to find and buy repo cars, it is crucial that you inspect the vehicles thoroughly before purchase. There is usually no test drive, warranty or guarantee on a repossessed auto and often no returns either. That means once you sign and pay, it's yours, running or not. Sometimes your bank or credit union will allow you to look at their repo file, which lists all the cars and trucks they have repossessed and would like to sell.
Often the lender just wants to recoup their losses, so you can get very good deals this way. Sometimes you can even get financing for the car directly from the lender that owns it. The downsides to this method are that banks usually do not bother with the expense of cleaning up or repairing the vehicles before reselling them.
They want to get their money back quickly and move on with the business of banking. So you may have your work cut out for you to get your new repo car road-ready after you buy it.
To purchase a repo this way, simply make a bid on the car you like from the repo list. The bank may refuse your offer or wait to hear other offers from dealers and other buyers. This part of the process may take a few weeks. If one of those cars is of interest, you can determine what the bank wants for the vehicle, then arrange to inspect it.
Assuming the car is in decent condition and worth the asking price, you can either pay cash to acquire the bank repossessed car or arrange for financing. One of the benefits of purchasing a bank repossessed car is that banks are often anxious to offset their losses on the defaulted loan. This means that it is sometimes possible to obtain a good quality used car for considerably less than you would pay at a used car lot. If the vehicle in question is owned by the bank that you currently use for your personal accounts, arranging the financing can often be accomplished in a couple of hours rather than taking a day or two, making it possible to be on your way in very little time.
After many years in the teleconferencing industry, Michael decided to embrace his passion for trivia, research, and writing by becoming a full-time freelance writer. Ph, the process is much easier and a lot less risky. Why is it not risky? Well first, you can fully inspect the unit. You can shorlist and look at the units online before an onsite inspection.
Second, You can even hire an expert mechanic to help you inspect the unit - we can connect you with one. Third, you will only be dealing with reputable banks and professional car advisers by going through the online process. Note: NEVER go with anyone pretending to be an agent of the bank, unless you're able to verify their identity through the website.
We know you have a lot of choices in getting a car, so why buy a repossessed car from a bank? There's a lot of reasons, but here are the top ones:.
Some owners just had a reversal of fortune and so they must give up the units. If you're lucky, you can even get units with km on the odometer and still pristine, but at low prices vs brand new. When you buy repossessed cars, you deal with banks with long histories, and Automart. Ph which has a long track record of helping many people buy their cars. Keep in mind though, that repossessed cars are sold as-is, where-is even though you're dealing with banks.
They're not trying to cheat you, but that's just the way the cars are sold - no warranties, since they're selling it as they got it as well. That's why it's best to have a mechanic go with you to inspect the unit. They're nearly brand-new, for all intents and purposes, at a fraction of the brand new cost! If that's not yet enough of a reason, I don't know what is. Repossessed cars mostly come from owners who took out loans from banks or financing institutions to purchase the cars.
For one reason or another, they're unable or unwilling to pay their amortization and so they must return their cars to the banks - thus the banks put them in their repossessed cars inventory. Through a Philippines court order, banks are then legally able to sell the repossessed cars or used cars to another buyer.
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