Buying Repossessed Cars from Banks
In today’s economy, a lot of times, it is practical to buy second hand cars from first hand owners. There are a lot of people involved in the buy and sell business of second hand cars nowadays. You can view some of them in various online and offline advertisements.
Alternatively, one of the best resource of second hand cars are banks. Since applying car loans from banks is quite easy, people who cannot manage their finances properly end up having their cars repossessed by these banks.
I had an experience working in a company that buys repossessed cars from banks before. For those of you who want to buy repossessed cars from banks, here are some of the things that I can advise you to do:
1. Ask for the OR/CR of the car. Make sure to check the OR and CR of the repossessed car you’re interested to buy. OR is the official receipt while CR is the certificate of registration. Check if it really tallies with the repossessed car you’re buying. In addition, you also need to check when was the last time the car was registered to Land Transportation Office (LTO).
2. Repossessed car inspection. This is definitely the most important step. Banks are selling these repossessed cars on an ‘as-is-where-is’ basis. They are most often stored in banks’ warehouses. With poor maintenance, these cars slowly encounter mechanical problems due to rust. You need to thoroughly inspect it if it’s in tip top working condition. Otherwise, if you found any defects on it, you may need to negotiate with the bank to lower their offered price to factor in the expenses you might have for repair.
3. Deed of Absolute Sale. As soon as you decided to buy the repossessed car that you want, definitely you should be signing a deed of absolute sale as a proof of the sale. You need this document in order to transfer both the OR and CR of the car to your name.
If you are interested in buying repossessed cars from banks and wants to know which car models are available for sale, just go to the website of that bank and view the list. If they don’t have a separate page for repossessed cars for sale, they are on the list of chattels for sale so you might want to check that particular portion of their website.
Alternatively, sometimes, the websites of these banks containing the list of repossessed cars for sale are not updated. In that case, you must verify with the bank and ask them for the updated list.
What To Read Next
Tagged with: Tips
Filed under: Entrepreneurship • Investments • Tips
Like this post? Subscribe to my RSS feed and get loads more!
7 comments
Yea u right some banks will want to play cunny lol
[Reply]
Nice tips. I’ve also been considering checking out bank foreclosed cars when it’s time for me to buy a car. In my opinion, dealing with “rust” due to limited use is easier to handle than damages due to “overuse”. But I may be wrong.
[Reply]
Tyrone Reply:
April 6th, 2010 at 1:36 am
I believe that some of the first hand owners of these repossessed cars do further damage to the car upon knowing that it will be subject for repossession (i.e. they get stereo, etc.). That is why inspection is really a must and should not be missed.
[Reply]
Do your bank allow physical inspection before bidding process? In malaysia, i think the most is some pictures, model, year and mileage. We don’t get to physically inspect the car.. so it will be higher risk
[Reply]
[...] diligence and verify their physical and legal condition. In relation to this, my friend Tyrone of Millionaire Acts recently came out with a very interesting article about repossessed cars and his article includes [...]
Nice post Tyrone, very practical tips! A good compliment to my recent post featuring a list of repossessed cars from AMA Bank.
@Zen Foo, most banks in the Philippines allow people to do a personal inspection but is limited to starting the engines. Test driving the cars are not allowed.
[Reply]
I think it is still best to buy new cars when you have the ample cash but these are quite practical tips Tyrone!
[Reply]