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What Are the Costs Of Buying a Car from an Online Auction?

By Mike Richards Updated: 07/03/2020 Posted: 10/15/2015

Have you thought about trying to buy a car from an online auction? It’s an option that quite a few people are considering, and many have already been successful with their purchases.

However, you should know what to expect when it comes to costs. Let’s look at the different types of costs associated with buying at a car auction.

The Cost of the Vehicle

Naturally, the most important expenditure when you buy a car from an online auction is the price of the actual vehicle. This will vary. Certain makes and models will cost more than others. The amount of damage, or lack thereof, can also affect the price of the vehicle. In addition, you have to remember that you are in an auction. Unless there is a “buy now” option, you are going to be bidding against others who want the vehicle as well.

One of the benefits of buying a car from an online auction is that you are often bidding against other dealers. They do not have any emotional investment in the vehicles they are buying, and if the price goes up, they will often simply move on to another vehicle.

While you may have to compete against other buyers similar to yourself, there is generally less competition than you might think. This helps to keep the prices on many vehicles relatively low, so you can find some fantastic savings when you go through an online auction.

The Auction and Dealer Fees

The next set of costs include the fees for participating in the auction, as well as potential dealer fees if you are going through a third party. Different auctions will naturally have varying fees, and this is always something you want to consider when you buy a car from an online auction. Know the fees that you will be spending before you make a purchase, so you can be sure that you have everything in your budget to cover the fees.


When you buy a car through an online auction, there is a good chance that it will be a salvage title. This means that you can’t simply run out and register and insure the vehicle. It still needs to have repairs so you can qualify for a rebuilt title. Depending on the extent of the damage, and the type of damage the vehicle suffered, the costs for rebuilding can vary greatly. You should also check the laws in your state to see whether the rebuild needs to go through a state approved rebuilder.

You do not want to have a surprise when you are trying to rebuild the vehicle, so make sure you learn as much as possible about the vehicle before you actually buy it. During an auction, you will generally have plenty of time to read the history of the vehicle, and to do a title search. You can learn more about the type of damage the vehicle has suffered and this will help you determine whether it is actually a good idea to buy the vehicle or pass on it.

In some cases, if the extent of the damage seems too much, then it might not make financial sense to purchase the vehicle. In those cases, look for another vehicle that’s in your budget and that will work for your needs.

Title, Registration, and Insurance

After you rebuild the vehicle, you will be able to get a title and registration for the vehicle. The price of title and registration vary greatly from state to state, so check with your local motor vehicles offices to learn the current fees in your area. This is something that you should do before you buy a car from an online auction, so you can factor the costs into the budget.

After you have the title and registration, you are able to get insurance. It’s not possible to insure a salvage vehicle, but you can get insurance after you have the rebuilt title. Many insurance companies can provide you with the basic insurance you need.

However, not all companies will be willing to offer comprehensive and collision coverage. Talk with insurance companies beforehand so you know how they handle these types of cases, and what the approximate costs will be.

Export and Shipping Fees

If you are in a different state or a different country from where you buy a car through an online auction, you have to consider how you will be getting the vehicle to you. Shipping companies charge varying fees for the service. Check out the prices and the reputation of the company. If you are exporting the vehicle to another country, remember that you will also have to pay duties when the car goes through customs.

How Should You Buy?

Your best option is to work with a company that has a dealer’s license. While you will be paying a fee for their service, they can make the process of buying much easier. They can get into dealer auctions that individuals would not be able to access, meaning you have more vehicles available, and you are competing against other dealers. As we mentioned, this could work to your advantage.

It is very important that you take the time to make a budget when you buy a car from an online auction. The budget that you make should incorporate all of the fees we’ve discussed. Also consider having some cushion in the budget, just in case you need to spend a bit more on any one of these areas. This ensures you are ready for anything and that you can get the vehicle you actually want. 

Explore our Vehicle Auctions, as well as finding more information about How These Auctions Work.