Purchasing the equipment necessary to start, expand, or maintain your business operations at auction is a great option. There are deals to be found and sometimes you may even be able to source new or near-new machinery. If you have sourced out the equipment you need, set your budget, and secured financing, protect the integrity of your deal by being aware of the hidden costs associated with purchasing at auction. Failure to ensure you have considered additional expenses that can be incurred may turn your “great deal” into a costly mistake.
Be Prepared
Ensure that your winning bid is the best deal for your business by anticipating all the hidden costs associated with purchasing your equipment at auction. With a strategy that considers all fees, a comprehensive financing solution, and some smart preparation an auction purchase can be beneficial for your business.
The Real Costs
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- Bid Deposits: Depending on your history with the auction house and your location, you may be required to place a bid deposit in order to participate in bidding. This is often a portion of your bidding limit and is usually refundable, but consider that it may tie up some of your capital leading up to the auction.
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- As-Is: Equipment purchased at auction is sold “As Is”. Any costs post-bid for cleaning, repair, and retrofitting are the sole responsibility of the buyer.
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- Where Is: Once purchased at the auction it is up to the buyer to remove equipment from the auction warehouse. Consider fees for dismantling, shipping, reassembly, and even storage if you are not immediately ready to install into your worksite.
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- Transaction Fees: Most auction houses charge a transaction fee. Often dependent on the value of the lot purchased, these fees could be as high as 10% of the lot value.
- Interest: Equipment will not be released to a buyer until full payment is received. Most auction houses require full payment within 7 days and if not settled promptly, the transaction could be subject to interest charges.
How Auction Financing Can Help You Cover Every Cost
First Capital Leasing’s customized solutions for auction financing can facilitate the acquisition of the equipment that is vital for the profitability of your business. Seeking auction financing strategies from a knowledgeable company with vast experience in the auction process will get you a personalized, tailored plan that considers the true cost of purchase at auction and can make a big difference to the overall cost of your project. Connect with the FCL team to explore your options for financing.
Your Best Auction Resource
Although purchasing your equipment at auction can provide a great opportunity to save your business money, it is vital to consider every expense. Do not struggle to pay for your large-scale purchases or fall short when payment is due. Secure funding through auction financing with First Capital Leasing. Our knowledgeable team can guide you through the process of buying at auction, ensure your purchase makes sense, and provide financing solutions that work for you. We partner with each client to support the growth of their business with strategies that make sense. Read more about our solutions for auction financing here.
Frequently Asked Questions:
Is there a maximum financing amount I can secure?
There is no maximum. We want to work with you to ensure you can secure the equipment you need. Contact our team to explore your options for auction financing.
Can financing cover all of my auction costs?
FCL Auction Financing is designed to fully support your auction purchase. But your best strategy is to connect with our team and explore every option for financing your purchase.
How do I apply for auction financing?
We have an easy application process. Apply Here. And once you have applied, there is no need to apply again. We will continue to partner with you for all your business financing needs
