Repossessed Cars

Repossessed cars, often referred to as “repo cars”, are vehicles repossessed by financial institutions such as Robinsons Bank when borrowers default or are unable to pay off their loans. They may have been collateral to a bank loan or sourced through a car financing loan that couldn’t be met.

Considered part of the used car market, repossessed cars are sold at well below the standard prices of comparable vehicles that are sold brand new. Repossessed cars also tend to be relatively new, with many of them just being under two years old. This means repossessed cars can offer prospective buyers phenomenal value that couldn’t easily be found on either the new or used market.

Robinsons Bank offers a wide selection of repossessed cars of all types from different brands. If you’re trying to buy a car on a tight budget, repossessed vehicles can be an excellent option.

Generally speaking, cars are one of the fastest depreciating assets. While values can differ depending on the type of car as well as the demand for the specific model, a new car will typically lose 10% of its value as soon as it is purchased and leaves the lot. With normal use and with the recommended level of maintenance, it will lose another 20% of its value in the first year.

In most cases, cars will lose half their value when they reach three years, more or less depending on the mileage and the condition.

But you shouldn’t confuse the price tag of a car with the real value that it can offer you. Cars with good maintenance and low mileage can be functionally and aesthetically no different from a new car of the same model. This means that repossessed cars can present an incredible value for prospective buyers without necessarily sacrificing any of the qualities that make them desirable in the first place.

Another reason repossessed cars are so affordable is that they are sold by reputable financial institutions not necessarily for profit, but to offset their losses from unpaid debts. This means that they would rather sell them before their value depreciates even further, which encourages pricing that’s advantageous to buyers. Many other used car sellers, on the other hand, need to make a profit or a commission, which drives up the prices of other secondhand cars.

Also, since institutions like Robinsons Bank need to maintain transparency in order to keep their clientele, there are none of the issues that often come when dealing with individual used car sellers. Indeed, most repossessed cars are sold on an as-is-where-is basis, which further reduces prices even further. This also gives educated buyers a golden opportunity to score excellent deals that simply couldn’t be found anywhere else.

The Philippine used car market sometimes gets a bad reputation, and there are a few people who might feel that they need to have a new car to get the best possible driving experience. The repossessed car market, on the other hand, offers a number of benefits that you simply won’t find in the rest of the used car market.

Here are a few advantages to buying repossessed cars that you should consider.

Repossessed cars can easily be found in as-new condition

In contrast to the rest of the used car market, repossessed vehicles are often less than two years old, and many can be found in mint condition. Functionally and visually, many repossessed cars that are up for sale are indistinguishable from brand ones of the same model.

Banks are easier to trust compared to individual sellers

The Philippine used car market is difficult to navigate, and there are plenty of instances of deals with individual sellers ending in legal action due to dishonesty and hidden defects. Banks, on the other hand, are more transparent and are far less likely to hide any issues with their offered cars. This makes it generally easier to trust banks offering repossessed cars compared to individual used car dealers.

Better documentation

Unlike many individual sellers, Robinsons Bank gives you the mileage, year, and other important details to give you information on the condition of each car before you check it out on the lot. This is a more transparent way to sell cars than you can expect from some other third-party dealers.

Better prices are available

All other things being equal, repossessed cars are priced substantially lower compared to brand new ones. Savvy buyers can easily score excellent deals on almost brand new vehicles for the fraction of the price of a new one.

While this is great news for anyone interested in buying a car, small businesses and startups might find that the repossessed market is the best place to look if they want to buy affordable delivery and logistics vehicles.

Financing is easy and hassle-free

Compared to typical payment plans for brand new vehicles, the payment terms for repossessed cars are usually easier to pay and are far less complicated. There are also usually ways to renegotiate the terms. Smaller installments, for example, are usually possible when dealing with a bank where. With many other used car dealers, this may not be possible. If you’re set on a specific model, then repossessed cars may be the only way to go if you only have a limited cash flow.

A wide selection of vehicles is available

The repossessed vehicle market doesn’t just offer excellent value for money. It also tends to offer more variety compared to the rest of the car market, both used and new, as well. Limited edition vehicles are quite common in the repossessed market, as are all of the most popular makes and models. Whether you’re looking for something unique, or simply need something to get around in, you’re sure to find many great options by looking at repossessed cars.

While you will need to submit several documents, buying a repossessed car in the Philippines is a surprisingly straightforward process, especially if you get one from Robinsons Bank.

Here are the basic steps to purchasing a repossessed car in the Philippines.

(Recommended) Consider financing

Yes, you can finance your repo car purchase! Robinsons Bank lets you finance your car purchases at reasonable, easy-to-pay terms.

Some of the benefits of financing include:

• Reasonable easy-to-pay interest rates
• Flexible 12, 18, 24, 36, 48 & 60 month terms
• Loanable amounts up to 80% of the car’s price
• Down payments as low as 20% down (with equity)

Contact a Robinsons Bank representative today to learn more about your car financing options.

Choose between purchase options

The different available repossessed cars will have different modes of sale available. Some can be bid for at a scheduled auction, or be bought through a negotiated sale. Cars that could be purchased through an auction typically have a “floor bid price”, which is the lowest the bank is willing to go at an auction, and a “buy now option”, which is a higher price that lets you end the bidding and purchase the car outright.

Depending on your reasons for purchasing a car and your budget you’ll find that there will different advantages to negotiated sale and auction options.

Fill out and complete the application and bid forms

If you choose to bid at an auction, you’ll have to contact the bank and fill out an application form and a bid form where you’ll need to include the car identification details and the amount you intend to bid. At this point, you may be asked to submit various completed documents, including those necessary for compliance with Banko Sentral ng Pilipinas guidelines.

Make a refundable “bid deposit” check

In most cases, you will be asked to make a small refundable bid deposit check before you can make a bid. This is meant to deter joybidders and ensure that you are serious about purchasing the vehicle. This amount is then deducted from the total in case you win the auction, or returned to you if someone else makes the winning bid.

Wait for the bid results

If you’re purchasing the car outright, no bidding is needed and you could proceed with processing all the relevant documentation, including your car’s title transfer. If not, you’ll need to wait until you are informed if your bid won through phone or email.

Pay the rest of the bid balance

If you won the bid, you can then pay the rest of the balance, minus the bid deposit. Regardless of whether you chose to finance the car or if you’re paying with cash you have on hand, payment is straightforward and there will be someone from the bank to assist you at this stage. After you have made the payment, you will be issued a copy of the official receipt (OR).

Pick up your car

After you’ve paid the remaining balance, you’ll be given clearance to pick up your car at the lot as well. You’ll need this to be able to drive off the lot with your new purchase. You will likely be given the certificate of registration when you pick up your car as well. Be sure to verify the times you could pick up your car with your assigned bank officer, especially if it’s located at a lot far from where you live.

Get the deed of absolute sale, OR, and CR

Around the time you pick up your car, you’ll be given the deed of absolute sale (DOAS). At this point, you should already be given copies of the OR and CR as well. The bank will then be able to give you the originals after a set number of working days.

Complete the title transfer

You’ll need to take your original documents to the Land Transportation Office and the designated Registry of Deeds to complete the transfer. Four copies of the original and duly notarized deed of sale/transfer/conveyance are also needed, as are a completed and approved Motor Vehicle Inspection Report (MVIR), Insurance Certificate of Cover (CTPL), and your Taxpayer’s Identification Number (TIN). Other documents might be requested as well, especially if your LTO office is located in a different district from where the OR and CR were issued.

While this may look a bit complicated, it’s far more straightforward than it seems. Should you have any questions or issues, a representative from Robinsons Bank will be happy to help.

There is an art to buying repossessed cars that goes beyond the minimum required processes. Here are a few tips that will ensure the best possible experience when buying a repossessed car.

Make a shortlist of the cars you want to buy

Try to decide what’s most important to you before you even visit the lot. You can narrow down your choices by asking yourself these questions:

• Do you need a van, a sedan, or an SUV?
• Are you looking for a luxury car?
• Will you be driving out of town regularly?
• Are you in the market for something unique?
• Is the car for personal or for business use?
• Can the car fit your available parking space?
• What is your available budget?

By asking yourself these questions, you can avoid making emotional and potentially expensive decisions later on.

After you’ve decided on what you’re looking for, do some research and figure out which locally available models will best suit your needs. Check out Robinsons Bank’s repossessed cars page to find out which models are currently in stock.

Research the current value of the cars you’re looking at

If you want to make sure you’re getting a good deal, you’ll need to know what the available cars are worth on the used market. Take some time to look at other listings of the same models you are interested in and take note of the prices.

Expect the lots to be far from where you live

Robinsons Bank has a number of different car lots and you might find that your dream car is in a lot far from where you live. This may mean that you can’t just expect to drop by in an afternoon. If this is the case, you may want to prepare to make a day out of your lot visit and look at different sites and things to enjoy in the immediate area.

Set your expectations

Many of the cars you will be looking at might be dusty or in need of some maintenance. Their batteries might be dead and the tires may need some air. This is normal, as the previous owners are usually given plenty of time to pay off their balance and reacquire their vehicle. We also have to consider that people in financial trouble may not necessarily be able to maintain their cars properly. This doesn’t mean, however, that a car is worthless. After basic maintenance, the majority of repossessed cars should be in good working order.

Consider applying for a car loan before you buy

Having the means to finance your purchase can come in handy and make buying a repossessed car much less of an immediate burden than it would be otherwise. This could also help you purchase cars that you might not normally be able to afford with just the cash you have on hand.

Bring a mechanic or a knowledgable friend along for the viewing

If you don’t know anything about cars, it’s important that you bring a mechanic or a knowledgable friend with you along for the viewing. They should be able to help you spot which cars are a better bet and which ones can be problematic down the line. We highly encourage you to bring an expert with you, as most repossessed cars are sold on an as-is-where-is basis. Even if it may cost you a few thousand pesos, having someone knowledgable with you may potentially save you a lot of money.

Look out for the signs of a flooded car

Floods are becoming more and more prevalent in the Philippines, so it’s important to know how to check for signs that a car has been flooded. Flooded cars tend to suffer from serious reliability issues that unfortunately aren’t always immediately obvious, even after a test drive.

Be sure to check for any signs of flood damage. These can include a moldy odor, rusted areas between the carpet and the body, and any signs of corrosion in the interior and exterior. You can use a mirror to check for rust under the seats and dashboard if needed. Be sure to check for water damage on the fabrics and upholstery as well.

Consider the “buy now” and “floor bid” prices

Being able to bid for cars and purchase them at a low price is part of what makes the repossessed car market so exciting. However, you should also consider the “buy now price” even if it may be more expensive than the floor bid price. These prices are often already reasonable when compared to other secondhand cars of the same model, and they’re always significantly lower than what you’d need to pay for the same model when purchased brand new.

If you’re set on buying a car for personal use and you’re not sure anything comparable will come up soon, you should consider buying it outright. If you’re not too concerned about having a specific car, then bidding at the auction might be the wiser option.

Ask if there are upcoming cars that aren’t listed yet

There may be incoming models that haven’t yet been entered into the system. It couldn’t hurt to ask if anything is coming in that you might be interested in. For all you know, all you have to do is wait for a week for your dream car to be available.

Include repair and maintenance costs in your budget

Your car expenses don’t end when you drive the car off the lot. Chances are you will need to include basic maintenance expenses as part of your total car budget. Given that repossessed cars are sold on an as-is-where-is basis, you may want to allocate anywhere from 10% to 20% of your purchase budget, just to be on the safe side.

Go for a test drive

There’s no better way to find out if a car is meant for you than taking it out for a test drive. Not only will a test drive give you a much better feel for how it handles, but it could also help you spot any potential issues as well.

Choose Robinsons Bank

Robinsons Bank offers a wide selection of repossessed cars as well as simple financing options that put your dream car within your reach.