Let’s talk about Red Light Vehicles for a minute. 
When a vehicle is consigned for auction it needs a light designation. The light designation is agreed upon by the auction and the Seller. Here is a quick breakdown of the three light designations Louisiana’s 1st Choice Auto Auction offers green, yellow, and red.
The green light designation tells the Buyer that this vehicle is guaranteed under the conditions outlined in the NAAA Arbitration Policy, except for specific disclosures or announcements made prior to the sale.
The yellow light is an indication to the Buyer that the Seller has made announcements that qualify/clarify the condition or equipment and limit arbitration of this vehicle. Announced issues cannot be arbitrated.
The red light designation will only qualify for arbitration under the rules outlined in the NAAA Arbitration Policy.
There is a common misconception that red light vehicles cannot arbitrate under any circumstances. Red light vehicles that are sold for MORE than $1,500 can arbitrate for unannounced structural damage, odometer discrepancies, and title issues. Vehicles selling for $1,500 or LESS are only eligible for arbitration under title issues. Determining structural damage can be complicated, not all damage is considered structural. So this why a thorough inspection of all of your vehicles will benefit your business. Knowing the ins and outs of the NAAA Arbitration policy is the key to being successful at any auction. If you have any questions about arbitration please reach out, we are here to help!