If you've been following us for a while, you've already read in our articles that when you win a vehicle at auction, you have to pay for it in cash. This is common most of the time, but as always, there are exceptions. And it was thinking about this type of exception that we're going to show you today whether or not there is the possibility of... financing a car auction. 

If you want to buy a car at auction because it's a cheaper option, but you don't yet have all the money to make a purchase, you've probably already considered the possibility of financing the purchase.

Now, we'd like to ask you: In your opinion, is there any way to finance a car from an auction?

Regardless of your answer, in today's article we'll discuss everything about financing cars acquired at auction. 

Don't miss out, as this could be the opportunity of a lifetime to finally buy your dream car. 

To the surprise of MANY people, we say yes! 

It is possible to finance a car purchased at auction. 

Although this is a purchase that can be made, it doesn't necessarily mean it will be easy!

That's because not all financial institutions grant credit for this type of transaction. 

In some situations, the down payment required to finance a car from an auction ends up being very high, making the deal unfeasible, since auctions are known for attracting many people due to their prices. 

With that in mind, it's time to move towards a logical line of reasoning:

If financial institutions auction off repossessed vehicles to avoid losing their investment and even profit from them, why can't they also extend credit to those who will buy the auctioned vehicle?

That makes sense, doesn't it? 

But as we have just shown, not all finance companies do this, nor do all auction houses allow their vehicles to be purchased through [methods/methods]. financing. 

Although there are various types of auctions, such as judicial auctions or scrap metal auctions, for example, only auctions of vehicles repossessed from financing allow for sales in this manner. 

Here, a very important explanation is needed regarding the term "recovered". 

A car repossessed from financing does not necessarily mean it has suffered any kind of damage, as is the case with a car recovered from an accident, for example. 

The car, recovered from financing, was repossessed by the finance company, which took back the vehicle after offering credit to the person who had failed to pay the financing installments. 

Therefore, in order to avoid losses, the finance company puts the car up for auction to recover its investment. 

This is the only way to finance a car from an auction!

Financing a car from an auction is literally a matter of pure negotiation!

If the finance company that repossessed the vehicle doesn't extend credit to those wishing to buy a car from their own garage, this could lead to a drop in their sales. 

As is well known, a large portion of vehicles sold in Brazil today are purchased through financing. 

Therefore, it makes no sense for a car that has already been financed once and has no issues or problems to be financed again. 

In fact, the finance companies that do this earn twice, since the same vehicle was financed twice. 

Although it is possible to finance a car from an auction, it's important to keep in mind that the financing process is the same for both brand new and used cars. 

Financing depends entirely on the credit policy practiced by the institution. 

In other words, it includes not only the origin of the purchase, but also the consumer profile. 

In other words, you might want to finance a car from an auction, but depending on your situation, that may not be possible. 

To achieve to finalize the dealIt is very important that you have a good credit score, meaning you cannot have any outstanding debts or a negative credit history.

Maintaining frequent bank transactions, proving income, and fulfilling all other bureaucratic requirements are important for your loan application to finance an auction vehicle to be approved. 

Another criterion for approval of financing for a car from an auction is that the vehicle must be no more than 15 years old. 

Vehicles that have been involved in any type of accident also face objections when it comes to having financing approved. 

These objections include: devaluation and high entry requirements. 

Finally, the documentation must be completely up-to-date, with no outstanding fines of any kind. 

Although at first glance it may seem advantageous to buy a vehicle at auction through financing, this alternative can have some disadvantages down the line, as we will show now. 

The first of all advantages of financing A car auction is the opportunity to place bids and win the vehicle without actually having the money in hand. 

Another positive aspect of this type of deal is the possibility of buying a vehicle for up to half the price and paying for it in manageable installments that literally fit in your budget. 

But as we've already mentioned, not everything is rosy in this type of business, as you'll discover below. 

Since financing always requires a certain down payment, at least 20% of the value, this can end up being an obstacle. 

Many auction vehicles have rather low prices, so the down payment to finance the purchased vehicle may seem too expensive and make the deal unfeasible. 

Another factor that can hinder the process is the bureaucracy that usually surrounds financing and the requirement for the client to have a clean credit history and up-to-date accounts. 

Finally, regarding the disadvantages, if the car has any kind of dent or damage, the finance company may not approve the loan. 

The good news is that yes, it is possible to finance a car from an auction! 

However, for the deal to actually go through, many things need to be aligned. 

It's no coincidence that most auction houses don't even mention the possibility of buying a car at auction through financing.

That's because it's a difficult deal to pull off, so it practically doesn't exist.

Ultimately, you're the one who will decide whether financing a car from an auction is a good option. 

Our suggestion for this conclusion is that you weigh everything and consider the advantages and disadvantages before opting for this type of negotiation!

Now that you know it's possible to finance a car from an auction, how about checking out the 10 best auction options for you to participate in, including private and public auctions?

After a thorough analysis, our experts have identified the best options. 

To check them all out, just click the link below!