A lot of people purchase cars for below market price and after some repairs and clean up, they turn around and sell the car for a profit. This concept of flipping cars is a great way to make some extra cash if you know how and where to purchase cars at well under the market price. Knowing where to look and what to pay are the two crucial concepts you need to master in order to really become successful at flipping cars. In today’s economy there are cars out there that can be had for pennies on the dollar, you just need to know where to look. Banks are looking to survive and collect any money they can on outstanding car loans, private sellers are looking to unload second cars to generate extra cash, and some people are even selling their only car because they need any money they can get right now.
Seized vehicle auctions – This has always been one of the best places to buy a car, even amazing late model cars, for literally pennies on the dollar in many cases. Government auctions that sell off seized vehicles may do a traditional auction format, while some may offer a few vehicles for a low sticker price. Either way you are sure to get a great deal. Many of these vehicles at a police auction are seized during a bust or arrest, but you would never know from looking at these vehicles. You have to buy as is on the spot at police auctions, so it is best to do your research beforehand and inspect the car well before ever placing a bid. Also get there early to get a chance to look at as many vehicles as possible and to give you time to consider how high your bids will be.
Bank repo auctions – With the economy in the state that it is, the sad truth is that many people can no longer afford to make payments on their homes and vehicles. The vehicle is generally the first thing to be repossessed if payments can no longer be made, and this is a case where one person’s misfortune can be your fortune. Banks aren’t usually interested in making a profit on these repo cars, they just want to collect back as much of the car loan that is still outstanding. Now, more then ever is a great time to check out bank repo sales and auctions which may be held in your area or can be found on the internet as online auctions. You can even sometimes find bank repossessed cars and trucks for sale in the paper and on Ebay. Vehicles sold after being repossessed are sold as is, so it is best to do some research beforehand and inspect the car carefully before purchasing.
With bank repossessed cars remember that the bank who issued the car loan is the one selling off the car. You can get some really nice cars that have been repossessed, especially many late model cars as people often take out car loans on cars they want now, but can’t afford upfront. Depending on how much of the loan was already paid off, you could get a late model car for a fraction of it’s sticker price especially since banks are desperate to stay alive and will collect any amount they can on outstanding debts.
Private sellers – Again, the time is now to buy cars with the intent of flipping them for a profit. Many people may own multiple cars or may be looking for extra cash. Rather then turn to payday loans and credit cards, they may see extra money in their second car. They know that to move the car and get cash in their pocket, they’ll need to offer a good deal on the vehicle. For you, this can mean getting a car for way below market price. An added benefit to purchasing through a private seller is that they’ll often allow for negotiations on the price, allow you to think about the purchase for up to a few days, and even may allow you to take the car to a mechanic for inspections before a decision is made. All this combined in this economy, makes for great cars for sale sitting in driveways and parking lots across America.
Also don’t forget to check your local newspaper ads, cars.com, and of course Ebay motors to check out a lot of cars and trucks being sold privately. The key here is that people need extra cash and need it quick, so those selling privately are looking to sell as soon as possible. Check out the Kelly Blue Book before negotiating and make sure to offer lower then the person’s asking price. You’ll be surprised how low some sellers will go today and you never know what kind of car or truck you’ll find privately.
One thing to keep in mind when buying a car from a private seller, whether online or in person, is to make sure the vehicle has a clear title. If anything seems suspicious about the car or the seller, ask for a report such as a CarFax.com report, or the car VIN information so you can do it yourself. Also ask to see the title before making an offer. Some sellers may be trying to quickly unload a car that may be repossessed soon, a car with a lien on it, or a car that has been in an accident or is having major mechanical issues.
Remember, an honest private seller has nothing to hide and will generally provide you with whatever information you need. Someone with something to hide will know the sale is dead as soon as you ask for a car history report or even to see the title or take the car to a mechanic for inspection. Private sellers in today’s economy can offer a great car at a low price, but also today’s economy is the perfect financial climate for those in financial trouble and looking to get rid of a car without a clean title.
What do you do once you’ve purchased a great car from one of these options for a great price? Hopefully you’ve done your research and compared prices before ever purchasing the car. Once purchased you’ll want to look around and see how much similar cars are selling for, then beat that price for a sure sell by selling a car in the best condition possible. Consider how much the car cost you including any repairs and clean up you may have to do before selling the car. Fixing up a car before flipping it may cost you extra up front, but it can ensure you’ll be able to sell the car for maximum value.
On the flip side of things, consider too that some people will pay top dollar for cars that may not be in top shape. Classic cars and rare cars often top this list and the number of them popping up at auctions, online, and with for sale signs on them is only going to increase as people today look for every extra penny to help them get by. In some cases the car you buy could be resold as is and still be profitable for you. By browsing Ebay Motors, looking in local ads, and researching in the kelly blue book you can see how much money if any you’ll need to spend to get your car on the selling block for the best profits.
A great way to sell a car you’ve recently purchased at auction or from a private seller is to use Ebay Motors to sell the vehicle. You can quickly compare prices of similar cars and see where you should set your price. Read up on other cars’ descriptions to see what kind of condition similar cars are in which will allow you to fix up your car to get in the marketplace. Ebay Motors allows you to post photos of the vehicle, offer unique descriptions, set your price (including allowing a buy now option), and even allows you to control the amount of time the auction will last. You can also set a reserve price which will ensure you won’t end up selling your car at a loss, allow buyers to make an offer, and offer pick up and shipping options. With Ebay motors you’ll reach a huge pool of potential buyers, see what the other cars are going for, and save money by reaching the most people or the least amount of money.
An important thing to keep in mind when selling your vehicles on Ebay is to always keep profit in mind. You can easily make a healthy profit on Ebay motors by taking the information above into mind when creating a listing for your vehicle. Always set a reserve price, otherwise an auction style sale could leave you obligated to hand over the car for less money then you bought it for. Offer a buy now price but make sure it is higher then you think the highest bid may be. If you have buy now and auction set up and the buy now price is lower then you could get in an auction, someone will likely jump on it and buy it now, which could leave you wondering if you could’ve made more with an auction only format. By setting the buy now price higher then you expect the car to sell for in auction, you’ll get a chance at having someone who really wants the car now paying that buy now price but will still make money if the auction bidding goes to the end. A higher buy now price could also stimulate more bidding action on you vehicle, because people will see the current bid price compared to the buy now price and see the chance for a great deal on their end.
A few things to keep in mind before purchasing cars with the intention of flipping them for profit:
– Never negotiate price as the seller. You don’t actually need the money right away, you are just waiting for the best deal to come around. Selling at a lower price then you should be getting just cuts into your profits. There is a reason why car dealers always start out at a far higher price then they may end up getting; but in your case you don’t need to worry about haggling. Either let Ebay auction style sales get your fair price or set a price and stick to it; a buyer will come along if your price is decent.
– Check your local laws. Many states have laws regarding how many cars an individual can sell for profit before a car dealer license is required. Under your name you may be limited to only a few cars per year. If you try out flipping cars for profit and enjoy it you may consider even getting a license to sell even more.
– Cash only. Unless you are dealing through Ebay motors, only accept cash for your cars and trucks. Bad checks and shady side deals may leave you with no money at all, in fact you may end up at a complete financial loss on the deal. With Ebay, only turn over the car or truck and title when funds are confirmed in your account. Never agree to transactions outside of Ebay when a vehicle is won or bought from you on Ebay; this offer to deal outside the Ebay system is a warning sign that something isn’t right.
– Research. Do your research before buying any car. Whether you buy from a private seller, buy online, or go to an auction; always check Kelly Blue Book to get an idea of how much you should buy and sell for. As the market always changes, take a look at current cars for sale to get an idea of the current market and how much similar vehicles are going for. When looking at a car at auction or a private seller; get as much information as possible on the vehicle. Look under the hood, inspect the interior, take it for a test drive, and have it inspected by a mechanic. Auctions don’t always allow these things to be done, if a car doesn’t seem right at auction then pass on it. Private sellers are far more likely to allow you a thorough inspection of the car if they have nothing to hide and want to make a sale. With online sales, always try to see the car in person before making a deal; too many scammers are ready to sell a car that doesn’t exist or isn’t at all like what is advertised.
-Investment vs. Potential Profit. People may get so caught up in a good deal that they forget the obvious when planning to sell the car for profit. The cost or investment you put into a car that you plan on reselling also includes any taxes, registrations, and fees. It also includes any transportation costs, repairs, and cleaning that may need to be done before selling the car. You may end up spending more on the car then you’ll get for it at sale time. In the case of certain auctions, you may not be able to get a good idea of how much you’ll need to spend extra on the car before selling it. In those cases you have to consider all additional costs when calculating how much you plan on reselling the car for. Then you’ll have to up the price a bit to get any profits. With private sellers, you may have a better chance of fully realizing the additional money you need to spend to make the car sellable for profit, and therefore you can easily walk away from vehicles that are going to cost more then they are worth.
With the economy the way it is, banks are seeing an increase in repossessed cars and people are looking to get extra cash by selling their vehicles for whatever price they can get to put more money in their pockets. For those who flip cars for profit, now is a great time to make money buying and selling cars. Flipping cars has always been a great way to make small profits with each car sale thanks to police auctions and bank repo auctions and now in 2009 the number of cars, trucks, and pretty much any kind of vehicle coming onto the market at well under market value is only going to increase.
Couple the increase of cars due to repossessions and more private sellers with the fact that everyone is watching their money more carefully, including those who happen to be shopping for their own next car, and you have the perfect marketplace for flipping cars. Competitively pricing the cars you purchase at auctions and through good private sellers, will attract those looking to save as much money as possible on their next car in today’s economy. You’ll be offering great deals to those who need a car but can’t spend allot while making a nice profit for yourself with each sale.