Online auctions have dramatically boosted the popularity of auction purchases and sales.
Buying merchandise from auctions is becoming increasingly popular in the United States. Consumers are turning to auctions to purchase everything from holiday gifts to homes. Purchasing from auctions either online, at live auction houses or through government auctions, can be a great way to get a good deal. Before bidding at an auction, however, its important to research the auction house or online auction site, to avoid scams. Items for sale should be researched as well. Its equally important to know the terms of the auction. In most cases, auction merchandise is sold as-is, and all sales are final with no returns allowed.
There are three general types of auctions:
Government auctions sell new, seized and surplus merchandise and real estate. Some government auctions are conducted online and others are held live (also known as public auctions). When auctioning real estate, the government often lists with a realtor authorized to accept sealed bids. When the government holds a live auction, they advertise it as a government auction and provide information on which government agency is sponsoring the auction.
Live auctions are either held at established auction houses or on-location of the estate or business hosting the auction. Unless otherwise stated, private businesses or individuals run live auctions. Some live auctions may be sponsored by charity organizations. Live auctions are frequently held to liquidate personal estates or business assets. Bidders at live auctions get to inspect the merchandise during a scheduled preview held before the auction. Bidders pay for their purchases after the auction is over. Most auctioneers also charge a percentage of the winning bid as their fee, known as a buyers premium.
Online auctions are increasingly popular due to convenience. Bidders view pictures and read descriptions of the items available for bid. Bidders place bids electronically, and then pay for their purchases after the auction ends, and their bid is accepted. Sellers ship the merchandise to the winning bidders after they receive payment.
Locate legitimate government auctions through federal and state government Web sites. The United States Government website gives links to federal and state auctions.
Live auctions exist in almost every city and town in the United States. Local papers typically run advertisements for auctions in advance of the event and often have a section specifically for auctions in their Classifieds section. Several Web sites also exist to help bidders find live auctions in their area. One widely used Web sites for auction listings is AuctionZip.
Online auction sites are abundant on the Internet and easily found with a search. It is important to investigate the history and the reputation of online auction sites and sellers before bidding.
Research the legitimacy of an auction advertised as a government auction if the auction information was found any place other than a legitimate government Web site. Contact the government agency listed in the ad to question the legitimacy of the auction. If no agency information is given, contact the auctioneer listed to request the information. If a government agency cant confirm the legitimacy of the auction, its probably not a legitimate government auction.
Check with local government agencies to find out if registration is required of auctioneers to hold live auctions. If so, be sure the auctioneer is registered. Ask for a printed copy of auction terms, including conditions of returns, if allowed. Find out exactly what the expected pay is besides the winning bid price; this could include entry fees, deposits, buyers premiums, taxes and shipping.
A check with the Better Business Bureau is a good way to learn the reputation of the auctioneer and the auction house or online auction site. Most online auction sites provide a rating system of their sellers, controlled by the buyers. Check the reputation of the online seller before placing a bid and use safe payment methods.
Unless otherwise stated, most auctioneers sell merchandise as-is. The items offered for sale may be dirty, damaged or incomplete. This is especially true when the auctioneer is selling used, vintage or antique merchandise. The responsibility lies with the bidder to look at the merchandise closely before bidding. Allow ample time to preview all merchandise during scheduled previews for live auctions. When bidding online, ask the seller questions about the item before entering a bid. If the pictures provided arent sufficient, request additional pictures.
When buying high priced merchandise at auctions, research the value of the items in advance to determine the actual market value. Auctioneers might state book or appraised values, or even current retail prices that are inflated or inaccurate for the current market.
The Better Business Bureau recommends bidders always pay for online auction purchases with a credit card, an escrow service, or COD to protect themselves if they dont receive the item, or the item isnt as it was described in the auction. They also suggest bidders research the reputation of the seller, ask about return policies and avoid impulse bidding.
However, if using an escrow service, they also warn bidders to be sure of the legitimacy of the service. Tips for how to verify the legitimacy of escrow services are provided at the BBB website.
The Federal Trade Commission warns bidders to protect their identity when paying for items purchased through online auctions. Social Security or drivers license numbers should never be needed to make an online purchase. Bank account numbers and credit card number should only be given on secure sites, after the sellers identity and legitimacy has been verified.
Successful bidding at auctions, both online and in person, require knowing the top bid which would still make the purchase a good deal. To determine this, factor in the cost of shipping, buyers premiums, tax and any other costs associated with having the winning bid. Enter a bid thats lower than, or equal to, the maximum bid determined. Stop bidding if bidding goes beyond this maximum bid.
New bidders at live auctions are better off waiting for someone else on the floor to place an opening bid before entering into the bid, to avoid starting items higher than necessary. All bidders should avoid bidding on items that werent seen and inspected during the preview, and avoid bidding on an item based solely on information verbally provided by the auctioneer.