When it comes to auctions, we’re all familiar with Hollywood’s version, which often includes bids in the millions, shady characters, and tense back and forth bidding, as the audience gasps in suspense. Well, while that makes for great movie material, that’s not how auctions go down, especially when the auction is carried out online.
The good news is that online vehicles auctions are nothing new and have been carried out for many years. However, the success of those who take part in these vehicle auctions mainly depends on having a plan, and even more importantly, getting the documents right. Keeping that in mind, here we are going to take a quick look at online car auctions and the documentation required to participate and drive away in your dream car.
What Is an Online Auction?
The first step you need to take when participating in an online car auction for used, salvage, or wholesale cars is to become a member of the platform you’re using. This is often a quick process that requires you to submit a government-issued photo ID (resident card, passport, or driver’s license).
In the case of a business, you will need to provide any business licenses you may have, along with a Multi-State Exemption Form and the Affidavit for Purchase form. All of these files will need to be attached during the registration process for approval. For those who are unsure if they require a business license to purchase inventory in certain states, you can also go online to check the state licensing rules and regulations in the state you live in.
Other Options for Bidding without a Business License
The good news is that as long as you have a government-issued identification on file, you are eligible to place bids at an online vehicle auction, even if you do not have a business license. There are many online vehicle auction platforms that sell to both businesses and the general public, so it shouldn’t be a problem.
Using Third-Party Brokers
Using third-party brokers is another option that you can use if the bid on vehicles at an auction requires a business license. It is important to note that not all brokers are able to facilitate with the purchasing of every vehicle at an auction, which is why it is best to first select the vehicle or vehicles you wish to bid on before discussing the details with a third-party broker. While you’re at it, be sure to read the terms of the broker whose services you are using, including any additional conditions and payment terms.
Bid on “No Business License Required” Vehicles
There are also certain platforms that provide ‘no business licenses required’ vehicles at their auctions, which can be taken advantage of if you are a business looking to purchase more than one vehicle at an auction.
For individuals, however, the process of buying vehicles at online car auctions is pretty straightforward. However, that doesn’t mean there are no documents involved. Whether you are thinking of purchasing a single car at an auction or multiple cars, you are going to need a bill of sale, which is by far, one of the most important documents for any buyer at an auction.
Bill of Sale
When it comes to buying a car at an auction, either online or at a brick-and-mortar auction house, there’s no document more important than the bill of sale or purchase and sale agreement. Although the bid may have ended with you being the highest bidder, the bill of sale is the document that’s going to seal the deal. This is true whether you are buying a family sedan, a truck, ATV, trailer, or a snowmobile; the bill of sale is proof that you are the owner of the vehicle.
Another reason why this document is so important is that if you do not have a bill of sale after you have purchased a vehicle at an online car auction, you will find it difficult to get it registered or get a title certificate. It is also important to note that both the seller of the vehicle and the buyer complete this document, and the bill of sale should include the year and make of the vehicle, the date of sale, purchase price, VIN, and the names and signatures of both the seller and the buyer of the vehicle. As a buyer, it is wise to make a photocopy of the bill of sale while the original document will be given to the DMV.
Other Important Vehicle Paperwork
But, that’s not the only proof of ownership that you will need once you have purchased a vehicle via an online auction. For instance, if you are in New York State, you will also require a New York State Certificate of Title, or else the ownership of the vehicle will not be transferred to your name.
The title will have the signature of the buyer and seller. It also contains other important information on the vehicle, such as the date of sale (as on the paperwork) and vehicle mileage. You will also need an Odometer Disclosure Statement if the vehicle you have purchased at the online auction is older than 10 years. This should be provided on the back of the title certificate and will ensure that the vehicle’s odometer reading is correct and has been documented.
You will also require a Damage Disclosure Statement which basically certifies that the vehicle has (or has not) been in an accident or has been damaged or wrecked. If possible, you should also get a California Smog Certificate for all vehicles that are 1976 or newer.
As you can see, whether you are looking for a clean or salvaged title car, there are multiple steps that go into purchasing a car at an online auction, with winning the bet just being one of the multiple steps that go into buying a vehicle at an online auction. The good news is that with the growing popularity of online vehicle auctions, you can easily find dealer auction brokers that are reliable and professional, such as RideSafely, who can help you purchase the vehicle you are looking for.
These specialized service providers also go the extra mile and can email you all of the details, including the invoice with payment instructions after you have won the online auction, which takes the guesswork out of using online vehicle auctions to purchase new or used cars.
Find out more
Benefits of Buying Online Auction Vehicles
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