Photo: AP/John Marshall Mantel
The costs and rules vary, but one’s thing for sure: Bidding on items in an online penny auction means you’ll pay to play each time, even if you lose. Like traditional auctions, participants bid on items, with each bid increasing in price.
It sounds like a deal–hey, you’re getting a big-screen TV for $10!–but factor in that the bidders pay to bid upfront, linking their debit or credit card to a PayPal account, and you’ll quickly realise it isn’t.
Consumer Affairs says bids are typically sold in packs, with the minimum pack costing between $25 to $60, depending on the auction site. Bids are usually priced between 50 cents and $1, and thankfully some are refundable within 30 days.
However, unlike traditional auctions, once you bid, you pay and that’s it. There’s no refund. You could be out $50 for 100 50-cent bids on a $3,000 computer, and even if you won, you’d still have to pay the sticker price for the item, plus whatever the bidding ended at, say $15.
Besides, the likelihood of winning is slim.
Since you’ll want to take your item home, you’ll have to pay for shipping and handling as well and deal with any headaches (broken or missing parts) that come later.
Have you tried penny auctions? Let us know how it went in the comments.