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One of the best places to find bargains on used iPods is eBay - however, there is a fine art to getting the very best deal.
First of all, make sure that you know the exact model and type of iPod that you are looking for. Next, do a search on that specific model. On the top, sort your results by price, with lowest first. Scroll down, and eliminate the auctions that are ending in more than five days as they are usually just not bid up to market price yet.
Look for auctions ending in twelve hours to the next day, which gives you enough time to receive responses back from the sellers.
Next, review the amount of detail each listing has. If a listing only shows a stock photo but has a good price, you can email the seller and ask for an actual photo. This is a good idea, as some iPods can get very scratched and beat up if they were used without a case.
Be sure to ask the seller if the battery has been replaced, and how long it holds a charge before needing recharged. If it needs a new battery, your bargain may not be such a great deal!
Make sure the listing includes the accessories that will be shipped with your iPod, and check on shipping prices. A trick that many sellers are using is to list their iPod at a low price, with a very high shipping and "handling" charge to make up the difference.
When bidding, set a price in your mind that is your "walk-away" price. Otherwise, it is very easy to get caught up in "auction fever" and pay more than you should.