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Steve

A Typical week: Repossessions down the entire East Coast

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MapEastCoastIt was around February and ironically, we had gotten around 6 repossession orders the same day. Not that getting six orders is rare, but these were different, they were all on the east coast up the line. We began working on the orders right away. I personally was in hopes they would all be still on the East Coast. They weren’t cars, they were large boats, in fact one was a house boat, two were large sail boats and the rest were 32 foot plus go fast boats,  and one lobster fishing boat.

Strange enough while we did have to skip trace these out pretty good, we really didn’t have any issues at all with any of them, they were all relatively close to the original addresses, at least in the same cities or close enough. Ironically I was in NYC that week and even more funny is the fact that I drove and my trip was just about over so stopping off at each state on the way home was perfect. My office sent me the files so I could map each one out. Keep in mind, usual protocol is to fly to the states or countries in order to handle the repo and fly out or sail out. [Read more…] about A Typical week: Repossessions down the entire East Coast

Can a Repoman Take My Car from the Garage

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garage doorI have my car inside my garage but I know it is up for repo. Can they come into my garage or property to take the car?

It is probably better off rewording this question to will a repoman or repossession agent come into my garage to take my car that is up for repossession? The answer is probably yes even though they are not supposed to. They are supposed to get what’s called a replevin order which allows them inside your property to take back the car.  That being said a repoman will usually figure out how to get you to open it up, perhaps run a hose inside the garage flooding it out or maybe find a garage door opener that might work giving them enough time to grab the car. You just never know what some repo men will do. [Read more…] about Can a Repoman Take My Car from the Garage

Car Repossessions

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Auto RepoCar repossessions are the most common, after all just about anyone with any credit can go to a new or used car dealership and drive away with a car. Amazingly around 6 years ago a statistic with one of our clients called Affiliated Financial was quoting that only a figure of around 6% sub-prime cars go out for repossession at all. I thought that number was extremely low and surely with the worsening economy that number must be growing since. Regardless of the percentage they claimed, the amount of repossessions they contracted out was at least 100 cars per month in Florida alone.

So just imagine between all of the finance companies, banks and in house car dealerships, car repossessions equate to allot of jobs each month nationwide.

I remember when first starting out as a repoman, I was hungry, I was depleting my savings from the multi-million dollar business I had previously that the economy at the time wrecked. It was ok as that glory lasted more then a few years and things change. it was time for me to enter a new realm, to learn a new skill set. I was lucky enough to be sponsored by two companies at the same time. [Read more…] about Car Repossessions

Boat Repossession

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HatterasWhile banks are very careful to begin working with new unknown companies they are still much more lenient working with automobiles then they are with vessels and understandably so. Working with vehicles has its tough side and tremendous amounts of legalities vessels typically carry much more value. A bank will start off whether they know you or not by checking how much insurance and bond coverage you have. The best bet and the way we broke into the vessel aircraft industry was by working with a company that specialized only in that. Over time the managers of the banks begin to know the agents and if you do a good enough job, they are more likely to give you a shot later if you do decide to go into the business on your own. Doing vessel repossession is a highly profitable business model for a company that knows what it is doing.

If you are really lucky the bank may even begin to work with you on liquidations of the assets which brings the profitability to the next level. Some repossession companies are hiring liquidation managers to only work with the liquidation aspect.

Vessels can be simple with trailers or they can be more complex as some of you might have seen on TV in the water. Either way the agent must have a decent organization skill to complete vessel repos.

Here is a list of things that are involved in doing just one vessel repossession.

  • Locate the vessel
  • Figure out the best time to take the vessel, usually early mornings for us
  • Verify hull number, on rear lower right side
  • Organize with a captain to meet you at the location
  • Call local police department to advise them of the repossession
  • Or contact Sea tow to meet you at the location in order to transport
  • Organize with another location to securely store the vessel
  • Pay any fees owed to the Marina after getting approval from your client
  • Take lots of pictures usually a whole roll
  • Do a personal property report
  • Keep the vessel secure until finance company advises what to do next

 

Believe me, anything that can go wrong usually will go wrong and always something not on the list will be added to that list.

Personally I enjoy vessel repossessions as I did those from A to Z throughout my career. It enabled me for the first time to travel throughout the United States and see some of the other beautiful states that I might not have been inclined to see before.

Another good thing with vessel repossessions is that many marinas are honest when it comes to vessels, they also know they will get their overdue storage money upon release. I personally have had cases where a marina was friends with the owner in a certain state and they went as far as calling the police, which usually will side with you in that scenario. Remember in certain states it is illegal to use police to assist in the repossession.

Aircraft Repo

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learjet_40The repossession business is big but when you start getting involved in aircraft repossessions it gets huge. An aircraft repo is far more complex, similar to that of vessels but instead of the Coast Guard you are dealing with the FAA. You are dealing with current log books, you are dealing with airport security and the list goes on.

Each aircraft repossession is very different as are the sizes of planes involved. A bank may give a car repossession firm a small Cessna plane to repo or even a Helicopter on a trailer. I remember my first helicopter repossession was on a trailer about 3 states away. So I had to drive at least 17 hours and pick up the trailer and haul it back. Not the kind of fun someone expects when doing an aircraft repossession, in fact a job like that is long and grueling like that of a interstate truck driver that not everyone likes. Personally my favorite part of the high end repossession industry was the skip trace end. Was locating assets worldwide. I was a natural from the start, and I really enjoyed it. You can read about the bloodline of the repossession industry here, skip tracing.

 

The only good thing about picking up an aircraft so far away was the pay involved. At least you know the pay will be fat even if the aircraft is a small plane, the minute the word Aircraft is used the price goes way up unless the bank is looking for a cheap deal and the unit is real junk. A bank will typically want to pay much more as the units are extremely valuable and need to be treated as such. If an aircraft needs to be flown out, there could be fines involved, there could be hanger or storage pay involved, there could be Pilot pay involved and there are times when a set of log books gets a whole separate repossession order. many times a pilot will not be able to fly a plane out due to missing log books.

Typical scenario involved with an aircraft repossession:

  • Major skip tracing sometimes world wide
  • Organizing repossession under the state or country laws where unit is located
  • High storage, hanger or repair bill, repo agent must lay out and get reimbursed if approved
  • Pilot rental if agent is not a licensed pilot
  • Organization of recovery (many scenarios)
  • Log book inspection
  • Flying plane to secure new storage
  • Personal property inspection and separate storage
  • Hire an auction company for liquidation. Aircraft must be sold through auction.

These are just some of the scenarios involved. I have personally experienced much  more then listed as you will too if you pursue the aircraft repossession industry or advance to that.

What a bank expects from you?

While it is much tougher to show up out of nowhere and start getting aircraft contracts. Banks typically will look for someone known in the industry. I used to get referrals all the time from banks calling other banks looking for a reputable firm. They will expect a large insurance policy. They will expect a bond for at least 1 million up to 5 million. I have had banks ask for financials that I had to provide both personal and corporate. The thing is once you get in, you get in and the Aircraft repossession industry will be a very lucrative one whether you handle liquidations or not.

 

Best Ways to Start a Repo Show

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Every now and then when I see a repo show it makes you laugh thinking if you did any of that in a state like Florida or California how fast you would lose your license and probably be charged and locked up. That’s when I realized just like these other shows such as Storage Wars and alike you know these might be reality shows but they are heavily misleading to the public. It was around the time that storage wars started, I was a few miles away from the office, stopped for a quick slice of pizza and see this huge crowd of people at a U Haul self storage facility in the back. It was all these people thinking the show they saw was reality TV and was in fact what really happens. If this was the case don’t you think these storage companies would have cared enough to figure out by now how to keep these lockers just like the tow companies figured out how to get around lien holders and keep the cars. Even if they have already they surely won’t auction off the locker with the Picasso painting hidden under the wicker chair in the back.

Top 5 ways to start a repo show

  1. Know absolutely nothing about being a repo man
  2. Never get licensed in the repossession or investigation fields
  3. Learn about the laws in repossession and do the exact opposite on the show
  4. Hire thugs that can’t act at all and use them as repo men and debtors
  5. Break actual laws on every scene

After these shows like listed in this repo show article, it just makes a mockery out of the industry, I mean just imagine the guys that were making a living for the last 10 years buying storage lockers and suddenly hundreds of reality show buffs show up and pay triple thinking they will find gold, even though this group will actually realize after losing a bunch of cash but as long as the show airs new groups will show up and continually wreck that business. Time to find a new game with no TV followings.  It kind of reminds me of the first time I got my concealed carry license, I sat in this room watching videos of possible scenarios and one scenario in particular has always stood out in my mind. It was this lady in her own bed and someone enters her house and attacks her in her bed I believe trying to rape her, she pulls out a pistol, shoots the guy and defends herself and she ended up getting charged with a crime, why? Imagine this, the guy had no deadly weapons in his hands so despite the fact that he is full blown overpowering her and raping her, she was still in fault to defend herself. Back then, there was no stand your ground laws, self defense was so hard to define I thought why even have this concealed license, it’s far too dangerous to carry and defend yourself. Thankfully, a few years after that too many justifiable cases were coming up and the good folks that rightfully defended themselves or their families were being wrongfully charged, so they developed stand your ground as it is today.

My first reality TV show offering experience

When I first got into the repo industry doing high end Yachts, Gulfstreams and Helicopters an offer came to the owner of the company to do a show. I can remember that day pretty clearly and I can also remember how quickly he turned it down and this was before the real ridiculous shows started airing, this was when they showed actual repo men out in NY doing actual repossessions only they were car repossessions. It wasn’t too long after that another company accepted the gig and there were high end repos happening on reality tv.

The problem was is in reality for TV these type of repos can get boring with little action, for me never boring but for TV viewers yes, so these new style reality show people figured out how to make reality shows that aren’t really reality making them allot less boring and unfortunately causing much more violence in the business.

Credit After Repo

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The day has come when times are tougher than usual and the once beautiful credit rating of 700 plus with little debt has suddenly been turned into a 500 credit score and the new Fiat you were driving has now turned into a 1998 Mazda you bought for $500.00. It’s unfortunate and will absolutely have a negative impact for at least the next several years, it will have an impact in almost everything you do. It will affect insurance premiums, it will affect a professional job hiring, during the interview they will have your credit report right there and discuss it one on one. In some cases they will ask you to take care of any negative credit before getting hired, in other cases such as a repo, they will outright deny you for bad credit.

It is almost certain this will actually haunt you for at least 7 years, in fact in many cases as you can read in this other article here on deficiency balances, they will most likely sue you for a deficiency balance if they see that you have obtained a job.

What people typically give up in a credit crisis

You are not alone, there are millions of others with lost or downgraded jobs that were forced to sacrifice one or more of the items they expected would continue to be able to pay. Typically people usually stop paying credit cards first and then decide that the car must also be downgraded in order to keep the house or continue paying the rent.  Even the businesses or businessmen that we have repossessed let the uneccessary things go first, it’s the survival mode. Do you really need that Ferrari or that quick getaway condo in Colorado? These things tend to go first, but the consequences are dire, for example if that business counts on lines of credit and suddenly has a Ferrari repo on their credit, that line of credit will not be extended ultimately causing the business to collapse. Average people losing their jobs or suddenly becoming way over extended usually realize this and purchase a old beat up car for the day the payment car is repo and the credit goes bad. It kind of reminds me of the hierarchy of credit, the natural process that people take on the dime knowing trouble lies ahead.

How long will my credit rating from the repo affect me moving forward

It will take 7 years for it to be off of your credit, that is 7 years from your last payment. There will be collection companies that purchase this debt and continue to confuse as far as when the debt was last paid, so you must keep track in order to ask them to prove it after 7 years. That being said, there are many programs that offer subprime financing for new credit cards or really bad new loans ranging from somewhere around 16% to 28% interest which is tough. If the reason for your repo is justified, such as a job lay off, or a medical emergency let them know and it may help slightly.

Will a repo on my credit stop me from getting a mortgage

With a good solid credit rating moving forward, a good mortgage rate is definitely a possibility in the first 2 years of improved credit perhaps bringing it to the low 620’s which is from what I understand what is needed to get a mortgage. Bottom line is credit after repo is real bad, but with a little bit of work and patience you can quickly build that credit back up.

The Bank Took My Car When I Filed Bankruptcy

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Over the years doing repossessions including all types of collateral, I couldn’t even begin to remember how many times the car had to be returned to the debtor. That’s right, returned right to the debtors driveway, door to door service, no fee’s, no questions asked nothing. What would happen is either as soon as the car gets repo’d the debtor would call the police to find out where it was, at that moment they would call their attorney and follow through with a bankruptcy filing.

Filing bankruptcy to avoid repossession

If the person being repossessed has an attorney, either the debtor will call and let the bank or finance company know they are in bankruptcy and give the attorney’s phone number or the attorney will call the bank upon the repossession and all they have to do is mention the word bankruptcy and the bank will immediately call the repo company and ask that the car be returned right away as it is now in legal status or bankruptcy.  The good news is if the car has already been picked up, the bank will still pay, but if the car has not yet been picked up, the order will be immediately canceled. All the cases we had, we made sure if possible to pick them up the very same day the case was given in order to always get paid on situations like these or not lose repossession orders.

Losing the repossession order due to bankruptcy

In this business there are many reasons to lose a repo order so it’s never a smart move for a repo company to sit on orders for more than a day or two. This of coarse doesn’t apply with high value collateral as they are much more complex typically, however for car repos, very important to get on them the same day. Besides bankruptcies, there are several other ways to stop the repo order. Making the payment- This will automatically cancel the repo order. Surely varies by state law, but probably get a lawyer to file some kind of motion can maybe get the car back for a while.

When I file bankruptcy do I get to keep the car?

In my experience from what I have seen, in most cases no. What it does is extend the time until the bankruptcy is discharged and usually that very same day a new repossession order is sent out. A lender will mark their calendar for the exact date of discharge and make sure its gone that very same day. However if in the time during bankruptcy something else is worked out or you manage to pay off the car, then that time gained turned out to be worth it for you. But normally a few months down the road we remember the order, or it matches one of the orders previously documents in the system.

Bankruptcy laws have changed since and we are not legal experts so it’s always best to contact a lawyer to help you somehow save your car or try to save your car.

 

Repossess auto sales

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For those that aren’t aware of how the process of repossession works and more importantly where does the car go after it becomes a statistic of repossession. Funny but there really is not one answer for this question as it has many variables involved. To start with the most important variable is what kind of collateral, however for this post lets go with the most obvious and most common question coming in. Where is my repossessed car being sold? Or how do I buy at repossess auto sales?

First off  it really depends on the agency the bank or finance company is using in many cases. Some agencies handle the entire repossession and sale of the car making it a much easier process for the bank ultimately getting it out of there hands by farming the entire thing out, the less people involved the easier it is on liability claims, on paperwork and on keeping track down the line. So they just give it to one company that in essence either does it all themselves or is a forwarding company sending out the repo orders and skip trace accounts to the little guys in each city. These larger forwarding companies normally have accounts in Manheim auctions which allows them to run the cars through in any city.

 

Simplified version of the repossession auto sale process

  1. Forwarding company sends company b an order, company b repossess that car
  2. Forwarding company gets pictures and condition report on car to send the bank or finance company
  3. company b sends out notice to the debtor
  4. Finance company sends out notice to debtor car will be liquidated
  5. Finance company instructs forwarding company of ok to liquidate
  6. Forwarding company if not sooner will instruct company b to transport to nearest Manheim auction (much cheaper storage, usually done after 1 week)
  7. Forwarding company will have its lane and run numbers for that auction each month
  8. Car runs through and sells for x amount
  9. Forwarding company will deduct all expenses, company b, their own charges, auction charges, skip trace if applicable, transport and storage
  10. The forwarding company will send the balance of the liquidation from expenses to the finance company and also send check to company b for repossession

This is why the finance companies and banks typically utilize forwarding companies now as this process becomes too many steps for the larger banks to handle properly or want to handle properly.  

Another process of repossession auto sales

As liquidators ourselves, we have done this type of liquidation for some of our finance companies in the past that have requested us to do so, and also for the fact that we have always liquidated all types of collateral and have more than 20 years experience of doing so.

repo autopromotionsYou may have gotten promotions in the mail, heard them on the radio or even 30 second TV commercials or have seen large tents being put up in big brand store parking lots. These are sometimes dealer trade ins or other times repossession auto sales. During these events there is typically a finance guy on site in order to approve sales on the spot, there is also heavy promotion and costs of leasing the space, permits involved, and a few sales people involved. The finance company does this in order to get more loans out there, rather than just liquidate. The auction is simple and would most likely bring more money up front after all said and done as far as just sales go, but these events can easily sell over 100 repossess autos even with no money down and make the finance company a killing in interest and fees for the next 5 years to come. So if they have a promo event like this once per month or even quarterly it helps sub-prime finance companies get more money out on higher interest rates typically ranging from 15% to 29% on a higher sales price to start.

If you are looking to purchase a repossess car, it is best  to contact a small local dealer in the area that may have access to repossession auctions going on each week that are not open to the public. We have been contemplating listing all of the local repossess cars for sale on a page of this site soon.

 

 

What is a voluntary repossession?

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We often hear the words voluntary repo or voluntary repossession and some of us think what exactly is a voluntary repo as opposed to an involuntary and how does that work exactly.  I will try to explain the differences below and the effects either may have on your future of obtaining a loan especially on another car.

A voluntary repo can happen a few different ways

The most common way is the typical family that realizes they have accumulated far too much debt, too many bills coming in from all angles and there is just no way they can afford to to make this car payment any longer. Rather than waiting until the gets into repossession status, they will call the bank, in many cases the actual loan officer of the bank or just call the dealership finance company letting them know that they can no longer make the payments. At this point the car is usually not yet in default so the bank or finance company will make a note of the call knowing that these people are willing to just turn over the car. Banks prefer voluntary as the Voluntary repossession is a cheaper payout to the agent. I can’t tell you exactly how much cheaper as we never got voluntaries ever but I have heard of companies doing them for around the $150.00 range. I couldn’t see doing it for a penny less than that, in fact I will do a post here explaining how some repo agents are just trying to undercut everyone else to death in order to gain new business.

The second most common way for a voluntary repo is when a car gets into repossession status and the debtor receives calls from the bank asking for payment, or asking when will payment be coming on the car, in essence creating a file of everything said by way of phone. I remember having access to my clients, the banks systems able to see the exact notes from the collectors because many times a person will say they are voluntarily giving up the car but have a change of thought and that car quickly becomes a skip trace. Of coarse the bank or finance company can get lucky and the debtor will say ok come and get it at my address after 6pm. The bank will put it out as a voluntary and get it done cheap, many times if the car doesn’t show the first time the repossession agent will bill for a full repo with notes that the voluntary didn’t show.

Many times a skip trace before being sent out as a skip trace will turn into a voluntary repo once the bank discloses they have the new address. It could have been that the bank had not updated the phone or address and had no way of contacting the debtor. However once a new phone number is obtained the people say “ok sure come pick it up” will be sent out as a voluntary. It’s the case of if they find me, i will give it up right aaway type thing.

Voluntary repossession is much better on the credit report listed as such as it shows those in the future looking at your credit that you volunteered to turn in the car as you knew you had a problem continuing to pay. A credit report will also list an involuntary repo and the amount of time it took to get the car which a finance company may decide against extending credit to someone who is going to hide the car purposely.

I know, its tough to give up a car that you put 2 to 5k down on, or a car you have been paying for 2 or 3 years on but in reality the bank still owns the car until it is paid. The best bet is to avoid the repossession or if you are really in trouble call the bank and turn it in to have some kind of decent statement on the credit report moving forward.