What is a Government Liquidation?

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  • Written By: Mary McMahon
  • Edited By: Nancy Fann-Im
  • Last Modified Date: 13 September 2019
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A government liquidation is a sale of items held by the government, usually at low prices in an auction format for members of the public. Government agencies may handle liquidations directly or contract them out to companies specializing in auctions and sales. Information about upcoming sales is typically listed in newspapers of record and may also be published in fliers and circulars to alert members of the public to sales they may wish to attend. The advertisements will discuss the types of items being liquidated.

The government liquidation may focus on surplus items the government needs to sell to make room for new things or getting rid of aging items that are no longer useful. These can include cars, trucks, equipment, surplus food, and a variety of other items. Often the prices are very low and the government may sell items in large batches. Retail stores can buy batches and in turn resell the items to members of the public at low costs.


Government liquidations can also feature seized items. When government seizures occur, the subjects may have a chance to redeem seized belongings, and if they fail to do so, the government becomes the owner and can use them, hold them in storage, or sell them. Sales are common, as they raise money for the agency that performed the seizure. With things like items seized for nonpayment of taxes, the sale is part of the process for resolving the situation that led to the seizure in the first place, by recovering monies owed to the government.

Goods at a government liquidation are sold as-is, and people must be sure they want to buy them, as there are no returns and the government is not liable for any problems. It is also usually necessary to pay in cash at the time of purchase. Some sales require prepayment, where people must buy their way into the sale. This discourages bidders who are not serious or people who just want to observe, as they may be unwilling to pay the fee. The monies paid apply to any auctions the bidder wins and any leftover funds are returned.

When attending a government liquidation, it is common to have access to the goods in a preview. This allows attendees to examine and evaluate items to determine if they want to make purchases. Options like turning on equipment and being able to test drive vehicles may be available by request. In other government liquidation previews, a physical examination is the only thing attendees are allowed to do.


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Post 2

@Vincenzo -- The same can be true of seizure sales. Here in my town, the best seized cars get turned into police vehicles while the shoddy ones are sold to the public. You can pick up some great computers, though, and some other electronic items from time to time.

As for the government surplus stuff, there are some diamonds in the rough. A friend of mine got one of those mail jeeps at a surplus sale. Yes, it was totally white but he painted it back to the original and got the correct stickers so he looks like a mailman driving around town.

He gets some extra points for being unique, and he couldn't have done that had he not attended a surplus liquidation auction.

Post 1

If you want the best stuff, go to a seizure sale. Items that are marked as government surplus are typically too old to be useful at all. You wind up with ragged out vehicles, computers that are too old to be useful and mostly junk items. Are there some good items there? Sure, but they are so few and far between that competition for those is fierce.

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