With the current state of the economy, there has been a spike of Kenyans opting for used cars as consumers are seeking alternatives to navigate the high costs of importation as well as elevated loans. Nowadays, Kenyans have taken up purchasing cars from auctions as it is cost-effective, transparent and can help circumvent import restrictions.
Buying a car from an auction requires awareness on auction processes with additional knowledge on how to choose your ideal car. There are various steps that you need to follow before entering a bidding war in order to save you time, money and ultimately give you peace of mind.
There are various types of auctions including:
Closed Auctions: This type of auction is invitation-only, limiting participation to a select group of buyers and sellers. For example, a business might auction company vehicles exclusively to its employees.
Open Auctions: Open auctions are public events advertised by auctioneers, allowing anyone interested to participate. Some may require entry or registration fees. These are the most common in Kenya.
Here’s a step-by-step guide on how to purchase a car at an auction in Kenya:
1. Research Auction Companies
The most fundamental step is to identify reputable auction companies in Kenya. Since banks and government agencies frequently use third-party auctioneers, verify the auction’s legitimacy by checking official announcements on the relevant bank or agency’s website. Additionally, seek recommendations from people who have previously bought auction cars.
2. Check Auction Listings
Most auction houses list upcoming auctions and available cars on their websites or on local dailies. Review these listings to find vehicles that interest you, noting details like specifications, starting prices, and auction dates.
If possible, obtain a vehicle history report for the cars you’re interested in to check for past accidents, ownership history, and other key information. Verify the details provided by auctioneers for accuracy.
3. Attend Pre-Auction Inspections
Auction houses typically allow potential buyers to inspect cars before the auction day. Use this opportunity to evaluate the vehicle’s condition, mileage, and any possible issues. If possible, bring a trusted mechanic with you.
4. Set a Budget
Establish your budget by factoring in the car’s cost, auction fees, and potential repair expenses, as well as additional costs such as registration and insurance. A clear budget will help you remain within your financial limits.
5. Register for the Auction
Registration may be required to participate in the auction, which might include completing forms and paying a fee. Ensure you have your identification and any necessary documents ready.
The documents include your KRA PIN, proof of funds, and any other requirements set by the auction house. If using an auto loan, obtain lender approval before placing your bid.
6. Understand the Auction Process
Familiarize yourself with the auction process, including bidding increments, how to place a bid, and what happens if you win. Also, review any unique rules specific to the auction company.
7. Bid on the Car
On the auction day, arrive early to secure a good spot. Stay alert, and when the car you are interested in is up for bid, begin bidding within your budget. Stick to your predetermined limits and avoid emotional bidding to prevent overspending. Maintaining financial discipline is essential throughout the process.
8. Winning the Bid
If you win the bid, try to conduct a final inspection to verify the vehicle’s condition meets your expectations. You must pay a deposit immediately, and the auction house will provide details on accepted payment methods and the timeline for paying the full amount.
9. Complete Payment
Pay the remaining balance within the given timeframe to finalize the purchase. You’ll receive the necessary paperwork to transfer the vehicle to your name.
10. Transfer Ownership
Visit the National Transport and Safety Authority (NTSA) to finalize the transfer of ownership. Make sure you have all the required documents, including the sales agreement from the auction house.
11. Arrange for Collection or Delivery
Once the paperwork is complete, you can either drive the car home or have it delivered.
12. Conduct Repairs and Maintenance
Auction cars might require repairs or maintenance. Ensure a mechanic thoroughly inspects the vehicle and resolves any issues before regular use.
By following these steps, you can navigate the auction process in Kenya with ease and secure a car at your own preferred cost. It is important to note that the process can be daunting especially for a first-timer, hence it is beneficial to have a friend or seasoned bidder accompany you to an auction.
