Things to Remember When Buying a Repossessed Car
The benefits of having your own car ultimately lies in the convenience it offers. Imagine having the convenience of getting anywhere with your family and friends – all at your own pace. Considering how taxing getting to most places is these days, a lot of people now want to own a car for personal use.
Today, you have a lot of options to choose from if you want to have a car of your own. You can straight up buy a brand new car if you have the cash, or you can finance a car through a bank or other financial institution. However, you can also choose to buy a second hand car if you want to save money.
You can buy used cars from private sellers, but did you know that you can also obtain them from banks? Some banks have used cars for sale, generally called repossessed cars. Here are some things to remember if you decide to buy a repossessed car in the Philippines:
What is a repossessed car?
In a nutshell, repossessed cars refer to pre-owned vehicles that are repossessed by banks when the borrower either defaults on the loan or is unable to pay off the debt. Some repossessed cars also come from borrowers’ collaterals. Here in the Philippines, the Security Bank, PSBank, Union Bank, and EastWest Bank are some of the many banks that have several repossessed cars for sale.
Why should you buy a repossessed car?
There are several reasons why purchasing a repossessed car from a bank appeals to many people. One reason is that for some, obtaining a repossessed car from a bank can be a safer option than buying a car from an unknown, private seller. As opposed to dealing with strangers, dealing with a reputable institution can ensure that legal documents for the car are easy to obtain and process.
Do your research
First, the condition of the car should always be your main concern. Remember, a repossessed car is also a second hand car. Since these kinds of cars have gone through owners, you can’t expect that they will be in brand new condition. Therefore, before you go to the warehouse where the bank keeps their repossessed units, you must research about the car that you’re considering to buy so you know what to check and look out for.
Inspect the car and ask questions
In some cases, banks sell repossessed cars on an “as-is, where-is” basis. This means that you, as the buyer, accepts the car in the condition that it is in, including any flaws that it has, so it’s important to check the car that you’ve been eyeing thoroughly. In doing this, it is recommended to bring your trusty mechanic with you to be completely sure. Nothing beats an expert opinion, right? Ultimately, there might be several parts that you will be concerned about. Check the most important parts – especially those parts that are essential to making the car run smoothly. Make sure that they are running well and are still in good condition.
Since repossessed are second hand cars, some other things that you should watch out for are signs of flooding or an accident. Take note that in some cases, some previous owners may not only have been unable to pay for the car anymore, but they may have also neglected the car’s condition upon finding out that it would be repossessed later on.
Test drive the car
Make sure to test drive the car to check every gear and the car’s overall performance. However, be aware that in some cases test drives and checking are not allowed. In these instances, you must make use of the resources available to you. There are bound to be photos of the car provided by the bank, so make sure to check these out and ask for an expert opinion.
Disadvantages of buying a repossessed car
While buying a repossessed car can be a great option for some, there are downsides. The quality of the pre-owned car itself can be “hit-or-miss”. Since they’re pre-owned cars, the condition will still depend on the maintenance and driving habits of the previous owner. So in a nutshell, the whole business of obtaining a repossessed car will still depend on lady luck. Take note that some banks disqualify offers that are less than the selling price, so be sure to offer a reasonable amount. Ultimately, when looking to buy a repossessed car, remember to always evaluate the choices available to you. Remember, you must always be careful when buying a car as it is a big decision to make. Whatever means you use, you’ll be stuck with the financial responsibility for several years to come.