When you buy a repo you’ll
get a car that has not been cared for and maintained. It’s going to
be in below average condition mechanically and cosmetically. Never
buy a repo unless you can get it for at least 10% to 20% below
market price.
A repo is a car that has been repossessed by a financial
institution because the original owner didn’t keep up the payments
on it. If they didn’t care enough about the car to pay for it then
it’s not likely they ever had any routine maintenance done. Repos
are usually trashed inside and out when the bank gets the car back.
Many times a repo has been in an accident, and the owner didn’t
have insurance. So they just stop paying for the car. Banks will
usually sell these cars to dealers who fix them up and resell them.
Some locally owned banks and credit unions will sell their repos
directly to consumers, while most major car loan providers sell
repos only to licensed car dealers at auto auctions.
Before buying a repo make sure you know what similar cars are
going for. Try for a price target of 10% to 20% below market value.
Of course, not all repos are in poor condition. Use your head
when considering a repo. Have it inspected by an auto technician, or
learn what to look in our used car inspection guide.
Always be sure to check the vehicle history at CARFAX on any used
car before buying.
