Buzz
Foreclosed or repo (repossessed) RVs are recreational vehicles that have been reclaimed by a creditor when the owner fails to make payments on time. The bank or lender will then auction off the vehicle, often in its current condition and at a significantly reduced price, to recover their losses. Discover how to locate, examine, and bid on a foreclosed RV at a reasonable price without encountering any surprises or disappointments with the vehicle.
Procedures
Locating Repo RVs
Review a bank’s repo inventory. Inquire with your bank or credit union about accessing their repo inventory. Examine this inventory to identify and place bids on vehicles that the lender has repossessed and intends to sell, potentially including RVs.
- Be aware that a notable advantage of this approach is the ability to finance the RV directly through the bank, often with minimal or 0% interest rates. Conversely, the downside is that lenders typically do not allocate funds for cleaning or refurbishing repossessed vehicles before selling them.
- If you are considering a repo RV directly from a lender, inquire about the circumstances under which the vehicle was repossessed. An RV voluntarily surrendered by its owner is generally in better condition than one that was seized from an uncooperative owner.
Explore Repo Resellers. Explore auctions organized by resellers specializing in repossessed RVs, a widely favored method for purchasing them. Browse resellers’ websites and local advertisements to review and bid on available options, or inquire about the location of in-person auctions.
- Benefit from purchasing through a reseller auction, as they typically refurbish vehicles well and prioritize moving inventory quickly over inflating starting prices. Exercise caution with resellers charging additional fees such as a 'viewing cost.'
- Be aware of challenges associated with selecting quality RVs from a large inventory of vehicles in varying conditions. Avoid options lacking proper documentation or where the title is in transit, as asserting ownership may prove difficult without a clear title.
Consider Dealerships. Consider visiting a used RV dealership to explore repossessed RVs acquired through auctions and subsequently refurbished. While this method may not yield significant savings compared to others, purchasing from a dealership streamlines the process, offering potential benefits such as financing options and warranties.
- Appreciate the advantages of purchasing repo RVs from dealerships, as they often improve vehicle conditions by cleaning, replacing components, and making minor repairs before resale.
- Understand that dealerships may increase prices on refurbished repo RVs. Without discerning negotiation skills or the ability to identify potential issues, buyers may end up paying similar prices to those of regular used RVs.
Examining and Researching an RV
Evaluate Market Prices. Explore alternative auctions or reseller websites to gauge prevailing market rates, particularly for RVs similar in make, model, or condition to those of interest. Exercise caution when confronted with starting bids or listing prices significantly above market averages.
- Refer to the NADA Guide for the specific RV model to determine its low value. Avoid overpaying by ensuring the asking price aligns with the vehicle's true worth, and be prepared to bid accordingly.
- Recognize the expectation of securing repo RVs at lower prices compared to regular used RVs, particularly when information about the vehicle's history is limited. Given uncertainties regarding the previous owner, a significant price reduction is justifiable.
Conduct Thorough Research. Gather relevant information about an RV of interest from lenders, resellers, or dealerships, and conduct additional research to assess its value and suitability considering associated risks.
- Prioritize sellers offering comprehensive details such as photos, vehicle histories, VIN numbers, and certified titles. Access to extensive information suggests better vehicle condition, facilitating thorough research and ensuring readiness for road use.
- Obtain repair estimates from auto repair shops for any known issues with the RV, incorporating these costs into budget considerations.
Thoroughly Examine the RV. Determine the timeframe and availability for inspecting a repo RV of interest, and meticulously examine it for any potential damage. Consider scheduling an appointment in advance or attending a public viewing before an auction begins. Additionally, explore the possibility of test-driving a motorhome or truck camper.
- Consider bringing along an experienced mechanic or RV specialist to provide a comprehensive evaluation of the vehicle's condition and potential issues, ensuring informed bidding or purchase decisions.
- If purchasing a repo RV from another state without the ability to inspect it in person, consider hiring an independent inspection service or trusted mechanic to conduct the inspection on your behalf.
Bidding and Acquiring an RV
Establish Your Budget. Utilize information obtained from vehicle details, inspections, and research to determine a maximum bid amount for the desired RV. Place bids within this budgetary limit, considering the seller's starting bid and employing strategies such as setting a maximum bid amount for online bidding.
- Pay attention to the seller's starting bid and initiate bidding at or slightly above this price point.
- If participating in online bidding, utilize features such as setting a maximum bid and enabling absentee bidding for automated bidding up to the set maximum amount.
Familiarize Yourself with Seller Terms and Conditions. Review all contracts, terms, and conditions provided by banks, resellers, or dealerships regarding the bidding and sale process of RVs. Thoroughly read instructions and disclaimers to understand your obligations.
- Some resellers may require meetings with brokers to ensure understanding of sale terms or auction procedures before placing bids or offers.
- Understand that placing a bid on a repo RV typically constitutes a binding agreement, with sales being conducted on an 'as is' basis. Any issues discovered post-sale, even if undisclosed by the seller, are generally non-negotiable, and sales are final without warranty.
Retrieve and Legalize Your RV. Take possession of your RV upon successful bidding, payment, and completion of necessary paperwork. Ensure compliance with state regulations to legally operate the RV on public roads.
- Complete the title transfer process, obtain insurance, register the vehicle, and address any necessary repairs or replacements to meet legal requirements for road use. Consult local authorities for specific steps related to RV legalization in your area.
- If bidding on an RV from a bank's repo list, await confirmation of bid acceptance before conducting an inspection, finalizing paperwork, making payment, and taking possession of the RV.
