Buying and selling vans at auction

It's important to understand that you don't get the same protection at auction as you do when buying from a dealer. You are protected in terms of title to the vehicle (i.e. it's not stolen or on finance), but there is no mechanical assurance or warranty. You can’t test drive it prior to purchase or simply take it back if you discover a mechanical fault after the sale. 

That said, there are lots of vans and pick-ups sold within their manufacturer's warranty. Some might also include a limited dealer warranty, with the seller happy to provide mechanical assurances for three months after the sale. Be warned, these vans are highly sought after and are usually among the first to be snapped up by traders. 

It’s vital that you set a strict limit on what you can afford. It's all too easy to get caught up in the excitement of the sale and overspend in the heat of the auction. Setting an absolute maximum budget will ensure that you don’t let emotion make a bad decision for you.

Know what you want to buy before you go anywhere near the auction. Sit down and work out what type of van you need and what sort of condition you expect it to be in. Take time to look at the results of previous auctions, from multiple auction houses, to get an understanding of what you will be expected to pay.

VAT is usually payable on vans, plus the buyer’s premium and an administration fee to the auction house. The buyer’s premium depends on the sale price and can be significant.

You can reclaim the VAT if your business is VAT registered. However, if the van is also used privately, the business can only reclaim the amount of VAT that’s proportional to business use.

If possible, and if you’re new to auctions, a couple of practice runs won’t harm. Try to attend a couple of sales before you buy to help familiarise yourself with the process.

Remember, the auctioneer is there to help you, as well as perform the sale. Take some time to ask the auctioneer some questions (before or after the sale) to get a full understanding of how the process works. A van sells in 30 seconds on average and you will need to be up to speed when it comes to buying.

Before the sale, try to avoid wandering around aimlessly checking out vans you like the look of. Instead, look up the listings online before the day of the sale. Most auction firms will have a decent website, with pictures and descriptions of what's being sold. 

Take the opportunity to draw up a list of three or four vehicles that you like the look of. Remember, stick to your budget and don't forget to include any auction fees or commission that may be payable on top of the hammer price. 

There are some common phrases you should know before diving in. They include: sold with a warranted mileage, specified faults, no major mechanical faults, sold as seen and buyers fee.

Although some of these may seem self-explanatory, they’re specific to auctions and often legally binding. You should know what they mean – not least so you know what to do if one of them proves untrue.

Arrive in plenty of time before the sale, so you can have a good look at any vans or pick-ups that interest you. If possible, select a couple of back-ups if you are unlucky in bidding for your first choice. 

If you’re too particular or fixated on a certain van you may be tempted to overlook some obvious faults. The turnaround for vans is high. BCA, for example, handles over 500 vans on any sale day – so there’ll always be something else suitable, either in this sale or another.  

A van sold 'direct' is straight from the fleet user. Look for evidence of service history, MoT and V5. Try to avoid vans that have no documents or a chequered past, no matter how cheap they look – that is where the risks can increase.

If the van's MoT history is not supplied, check its general performance with the MoT Files. This will give you a good idea common failure items for the make and model.

“Sold as seen” is the all-important phrase here – the paintwork, tyres, trim, load area and interior are all sold as seen, so it’s important to check them before you bid.

We also recommend that you follow the van as it’s being driven into the auction hall. Listen to the engine as it's running, as well as checking for bad signs like blue smoke from the exhaust. 

So you’ve won; you’ve bought a van. What next? Rules vary from auction to auction, but generally you’ll have a limited amount of time to collect the van (usually 24 hours) and you’ll have to pay a fee for any length of time it’s left at the auction house thereafter.

You’re legally responsible for the van the moment you’ve won the auction, meaning it’s your responsibility to make sure it’s roadworthy. It's also down to you to ensure it has insurance and road tax before it leaves the auctioneer's forecourt.

The commission paid out to the auction house is usually negotiable, so don’t be afraid to ask for a discount. However, be mindful of the hassle that selling at auction removes compared to a private sale – no phone calls, visits or test drives to worry about.

The money is usually transferred to you straight from the auction house within a week of the sale. All that in mind, the commission should prove a worthwhile fee.  

A big and well established auction house may charge a little more for its services - but it will know what it is doing, will be financially stable and will have a large captive audience, giving you the best chance of making a good sale.

Ensure your van is entered into a specific commercial vehicle auction. It will give you the best audience and increase the chances of getting the highest price. 

The 2008 Consumer Protection from Unfair Trading regulations, which succeeded the often-cited Trades Descriptions Act of 1968, makes it illegal to knowingly misrepresent your van in order to get a sale or improve its price. If you get caught you'll face a fine, at the very least. 

Similarly, the practice of 'shill bidding' - driving the price up by either bidding yourself or having someone with no intention of buying do it for you - is illegal. If you're caught, your van will be withdrawn, you're likely to be banned from future auctions and could face prosecution if it's found you've sold a van dishonestly that way.  

If your van doesn't sell you're likely to be liable to a fee regardless, for the work put in by the house. Again though, this is negotiable, so find out what the house's terms are and what you'll be expected to pay for a no sale.  

You might also be asked to pay a fee to place a reserve price on the van(s) or pick-up(s) you're selling. So think carefully about the price you set, otherwise you could be out of pocket if your reserve is unrealistic. 

Have all business logos, graphics and other paraphernalia specific to you or your company removed professionally before the sale. An older van could benefit from a full professional valet too, although that isn’t always necessary - a proper clean, inside and out, is what buyers want.

Having said that, do not over prepare, as trade buyers like to see the van in an honest condition. Does the vehicle have racking or interior accessories? Will they add much to the van’s value or will you be better off removing the fixtures and selling independently? Do your research to maximise the price. 

A van put up for auction should not have any outstanding finance attached to it, and if it’s been involved in an accident that’s required an insurance claim, that should be declared too.  

The Consumer Protection from Unfair Trading regulations make it illegal to sell a van that still has outstanding finance payments without declaring it, meaning if caught you'll face a heavy fine or worse. You could declare any outstanding finance during the auction, of course, but good luck selling that...

Even if it looks a little tired, a van with all documentation, a full service history, an MoT, a V5 and a spare key will be much more appealing to a potential buyer than a sparkling one of murky origins.

So make sure you’ve got everything in order before you sell. If you haven't, don't be surprised if the sale price is lower than you want - or if your van fails to sell. 

No matter how much you love your faithful old van, the buyer has no emotional involvement. Ask the auction house for a reserve valuation for a realistic understanding of how much it is really worth.

If determined to price it yourself, check out the results of previous auctions to get an idea of the sort of prices paid for similar vans. You may love your van, but a sky high reserve price will turn buyers off. 

Knowing what buyers want in the current market is key. A retail specification will always attract buyers, so metallic paint, alloy wheels and in-van entertainment systems are always popular and are likely to generate premium values.

Buyers also like to see ply-lining in the load area and a good level of equipment in the cabin for driver comfort. This means air con, navigation and a touchscreen infotainment are increasingly important to getting a good price. 

It’s worth looking into what sort of buyers will be at which auctions generally, and matching your van accordingly. Trade and non-trade buyers often buy at different price points.

Professional buyers will compete strongly for vans and pick-ups that are in ready-to-retail condition, particularly any vehicles with a high specification or unusual configuration. Non-trade buyers will want older, higher mileage vehicles. 

Because of the number of vehicles available and the many variations in specification, it is important to identify what your needs are and what is available at the auction.

Tim Naylor of BCA says: “Specification is always important, and buyers like to see ply-lining in the load area, side-loading doors and a good level of equipment in the cabin for driver comfort with air con increasingly important.”

It is easy to think that everyone at an auction is looking out for themselves, but at most auction houses there will be staff on hand to give you guidance if required. It is worth attending at least a couple of auctions before you intend to buy to get a feel for how things work, and this is a good opportunity to ask the experts.

Matthew Davock, director of commercial vehicles at Manheim says: “Ask questions of the professional on site, about the sale itself and the vehicle you’re interested in. Don’t be afraid to ask for assistance when buying, use the intelligence and support on offer.”

Although the amount of time you have to check over any potential purchase is more limited at an auction, you should arrive at the sale with plenty of time to take a close look at your target vans and go through the essential information.

BCA’s Tim Naylor says: “Check the overall exterior visible condition - paintwork, trim, tyres - and the interior cabin prior to sale. Check the load area, interior lining and doors. All these factors are 'sold as seen', so take every opportunity to examine the van in the line-up prior to entering the auction hall. When the van is driven into the auction hall, follow it in and listen to the engine running.”

The paperwork supplied with a van can tell you a great deal about how well or otherwise it has been cared for. As the vast majority of vans are company vehicles all the paperwork should be present and correct; if you buy a van without history you are not only taking a chance but also hurting any potential resale value.

Matthew Davock of Manheim says: “When is the MoT? How many owners? Look into the paperwork of the vehicle including the service history.”

Just like on eBay, it can be very tempting to go over your budget when bidding in the heat of the moment, so take away the temptation - take a reliable friend with you if need be.

BCA’s Tim Naylor says: “Set a limit on what you are prepared to pay. Don’t go over it in the heat of the moment and remember you will have Buyer’s Fees to pay and VAT is payable on most vans. If you are buying an older van, set aside some funds for a post-sale service and consider that you may need some minor repairs carried out.”

There’s nothing inherently wrong with buying a van that has come from a small business, but choosing a vehicle that has come from a big fleet customer should provide some reassurance that the vehicle has been cared for.

Manheim's Matthew Davock says: “Buy something that is coming direct and associated with a brand, whether that is a leasing company or a fleet management firm so you have history.” 

If you have your perfect van in mind it can be very tempting to hurry through the process and get it done, but a calm and measured approach will be beneficial in the long run.

Tim Naylor of the BCA says: “Arrive in good time and look around, walk the line-up and examine the vehicles on offer. Take time to choose the van that interests you, and if possible, select a couple of ‘back-ups’ if you are unlucky in bidding for your first choice.”

When deciding on your budget it is crucial that you take into account any buyers fees and also VAT, all of which must be settled before you can drive away.

Manheim's Matthew Davock says: “Don’t forget to include the VAT element into a purchase price - if you’re not VAT registered you can’t claim that back. Ask questions and check the fees before purchase.”

Getting a van that is right for you is important, but if you set your heart on one and it goes outside of your budget then you will be going home empty-handed. 

Tim Naylor says: “Flexibility. Don’t get too possessive about a particular vehicle or overlook some obvious faults. BCA’s larger auction centres will handle in excess of 500 commercials on any particular sale day, so if you miss your first choice, go and look again or walk away and come back another day.”

Larger auction companies offer vehicles that have undergone a mechanical inspection before sale, and although that means a higher price than one without, it provides extra reassurance that could save you a lot of hassle in the long run.

Matthew Davock says: “We (Manheim) sell with a mechanical check - where possible, make sure it is a vehicle with SureCheck (41-point mechanical check with seven-day guarantee) or equivalent for additional protection.”