One possibility is that you have the wrong bobbin for the machine. The machine could have been at the auction because the owner mixed up the bobbins with another machine and never could get the machine to stitch right afterwards. I mention this because that is exactly what happened to a classroom machine that was given to me to fix. The plastic bobbin for this machine was just slightly different than the bobbin that was actually in the machine; someone in the classroom had put the wrong bobbin in.
I looked up that model here:
http://www.sewingpartsonline.com/bro...odel-list.aspx
and it looks like it takes a class 15 metal bobbin. Is that what you are using? It's also possible for a bobbin to become distorted so, even if you are using the correct bobbin, you might want to try winding a new one. Sometimes even new bobbins are distorted from the factory.