Howdy, Driver? Yes, it is possible to buy a car from auction without dealer license if it is dealer only or private auctions.
Typically, dealer-only auctions do not allow public buyers to bid on vehicles, but you may be able to attend the live auctions.
Why would anyone want to buy from the dealer only sales if they have no dealer license permit? Well, the sincere answer is that you get to access the resources restricted to typically licensed dealers such as low-cost used vehicles, and, of course, you would be buying directly instead of contacting a dealer to buy the same vehicle at a higher cost.
You may be wondering why wholesale dealers restrict vehicle sales to dealers only. The reason is that wholesale dealers are not permitted to sell to the public directly; they can only buy from auctions/dealers and sell to dealers only. If a wholesale dealer must sell to the public, they must obtain a dealer’s license such as the independent dealer’s license.
How to Buy Car from Auction Without Dealer License
In the section, I disclose how a public buyer can attend dealer only auctions, bid indirectly, and buy a car without a dealer’s license.
Meanwhile, I have written an article on how you can buy a car from a police impound (you do not require a dealer’s license to participate in police auctions unless specified).
Below are the ways to buy car from auction without dealer license:
Negotiate with a Willing Dealer
Dealer only auctions do not allow public buyers but it is not a taboo to go to the auction without a dealer’s license.
Some licensed dealers can admit you in the auction to buy a used car but at a cost of about $250 to $1,000.
Of course, it costs the dealer up to $1,000 or more to run the business (insurance, license renewal, vehicle checks/maintenance, etc.), so, do not expect the dealer to get you access to the dealer-only auctions for free.
It is okay for the dealer to charge a fee, they have to cover their overhead. When you get into the lot, you can check the vehicle you want, however, you cannot bid, the dealer does the bidding on your behalf because you have no license.
Bid on No-License-Required Inventory
Yes, you can join dealer-only auctions without a dealer license by signing up for auctions with packages that allow public bidders or buyers (non-licensed).
However, the number and type of vehicles you can bid on may be limited, depending on the auctions.
On a platform like Copart, you do not need business licenses to bid on vehicles tagged ‘No License Required’.
Moreover, a public buyer on Copart can bid on vehicles in the No License Required Vehicle inventory with no restriction.
Depending on your state, however, you may need a business license to buy vehicles in private auctions depending on the type of title.
Get an Auto Broker
An auto broker is an expert that represents you; he picks and bids on an excellent vehicle on your behalf.
The first step you want to take is to get a list of brokers, visit their websites, compare their terms, understand their method of payment, and pick the most suitable to represent you.
Note that the auto broker you select must be eligible to bid in your state.
You should find the phone number or email address of the broker on their website to contact them for questions.
After registering with an auto broker, you will be given a unique member number to bid for a car in dealer only auctions in the name of the broker.
Some auto brokers affiliate with companies like Copart, so, you can check for member auto brokers on Copart, Register with them, and sign in to Copart with the issued ID and bid like a licensed dealer.
Join Online Auctions
To buy a car from the auction without a dealer’s license, you should sign up for online auctions on sites such as the following:
Before you sign up, I have written about how you can win an auto auction online.
Of course, your bidding competitors would be experienced licensed dealers and public buyers that signed up for the auctions. On some sites, you may have to sign up for premium membership to access private auctions online.
Go Through Someone
If you know someone privileged to get to the auctions under the name of a licensed dealer, you may negotiate with them to get you a car.
However, you would not be there to inspect the vehicles physically. So, you have to describe the kind of vehicle you prefer in detail and then the person would send you images/videos of the vehicle. A licensed dealer may not be willing to go with persons without a dealer’s license to the auctions.
Auctioned Vehicles are Sold “As Is”
When you attend the auction to buy a car, especially if you have no dealer’s license, you do not get to pick from a wide variety of cars as you would at the dealership.
If you have a particular color, model, and features in mind, the auctioned vehicles available may not match your desire. Moreover, you may face strong competition if you even find a vehicle that matches your specifications.
If you arrive early at the auctions, you may be able to test drive the car, late arrival may mean no test drive and you would be bidding on a faulty vehicle with no notable damage until you start driving it.
Meanwhile, like a typical dealership, you can test drive a car without buying it at the auction.
Can anyone buy from an auto auction?
Yes and no. “Yes” if the auto auction is open to the public and “No” if it is dealer only or private auctions. Nevertheless, you can bypass the restriction to buy a car from auction without a dealer’s license through a licensed dealer.
A dealer risks their integrity getting people to dealer-only auctions. Typically, dealers do not take non dealers to the auctions often to avoid ruining their integrity and focus on their dealership.
If a licensed dealer takes you to the auctions, they admire you, at least they are gambling with their reputation at the auctions.
Meanwhile, if you intend to buy and sell multiple cars, learn how to get a dealer license without a lot.
You can also flip cars without a dealer’s license if you have no money to obtain a dealer license yet.