You’ve probably seen penny auctions in adverts, offering to sell the latest gadgets, and even brand new cars, at astonishingly low prices.
Also known as bidding fee auctions, participants pay to make bids, as well as paying the final price of the item if they win it.
We take a look at the pros and cons of using penny auction websites, with some tips to help you enjoy successful bidding:
1. Each time you bid, it costs you money
On penny auction websites you have pay to place each bid, irrespective of whether or not you win the bid.
2. A winning bid could cost you more than on other auction sites
Remember: if you do win the bid, then you may have to pay your bidding fee on top of the item’s full final price.
3. It you don't win, you still pay
The obvious downside here is that even with unsuccessful bids, you'll end up spending money.
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4. Check the website’s refund policies
Are your bids refundable? Or once you've placed your bid, is your money gone forever? Can you get a refund for unused bids?
5. Examine penny auction websites' terms and conditions for extra costs per bid
Check to see exactly how much you are being charged per bid. Is it a flat rate, or does the rate vary depending on the value of the item? Is there a delivery charge to pay too?
6. Take note of what other customers are saying
Are they satisfied or dissatisfied customers? Read online forums, comments and reviews to get a flavour of the site.
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7. Do your research
Is using a penny auction site really a better option than using other types of online auction site, such as eBay? Are you getting value for money?
8. Check if there's a helpline or contact address for customers, should things go wrong
If so, what are your chances of a dispute being successfully resolved? Again, have a look at feedback from other customers.
9. Watch the auction
If you do decide to bid, then it makes sense to take time to keep an eye on the auction. It's all too easy to place a bid and then forget about it - which is both wasteful and pointless. And always stay tuned to an auction until it closes - you might just be in luck!
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10. Choose the right time to place a bid
There’s no point placing a bid hours before an auction ends. You’re best off waiting until the very last moment if you’re really keen to win; even five minutes before an auction ends you are likely to see a rival bidder jump in at the last moment to win the bid.
There are loads of penny auction websites out there, so take your time to do plenty of online research. Only choose websites you feel comfortable with, and which have strong recommendations from friends and family, plus positive customer feedback in comments and online forums.