In repossession there is a ton of things that unless people are actually in the company know little about. Most people think all you need is a truck and an office and you are good to go. While this is true in some cases, it is certainly not true for anyone trying to work for finance companies and national banks. In fact this might be one of the reasons that so many banks utlize national forwarding companies in order to eliminate the hassles.
What are some of the things that are hidden to be in repossession
A big thing believe it or not is cash. A large amount of liquid working cash is needed to be in repossessions. Why is that? There are actually several reasons for this and different players in the repo business as you know. Most people become known for what they do but very few do several kinds in the same company. Meaning if you do Yachts, you don’t typically do cars, if you do heavy equipment, you don’t typically do car repossessions. However in this business you need money no matter what type of recovery you handle. Sometimes cash must be laid out for up to 60 days, perhaps well into the 5 figures.
You need to be able to pay storage to release cars, yachts or aircraft. Yes you can take them out sometimes without getting caught and allow the marina or whoever to go after the debtor for the fees. However in many cases you will not be able to do this and therefore you must have cash to buy out unit from storage. Doing car repossessions in New York City, you will find that lots of cars are underground in parking garages. These parking garages are not cheap ranging from $40 per day and up, sometimes leaving a balance due of $4,000 or more on a car. You can’t call the bank and ask for cash wired, this would be super unprofessional and surely end your contract with them. You have to get permission from the bank or finance company to pay it, lay it out and wait out the time it takes to get paid each month. If you think that is high for a car just wait until you see how much yacht or plane storage runs when a debtor is behind.
Another expense after paying storage
If you remarket cars, yachts or aircraft like we do, you also run into a ton of expenses for different scenarios. First off to have a private auctioneer go to an airport to auction off plane if needed must be paid upfront. Auction fees that can run in the tens of thousands each week are sometimes paid upfront like on no sale cars, otherwise they are deducted from the checks. Which is not bad as you can typically take your entire fee out of the check you send the finance company.
Using outsource repomen in other states
I usually fly myself out of state depending on the job, however in some cases if its just a car with a normal repossession fee it is worth it to find a repo agent in that local area. These repo agents will hound you for the money within days after the repo. There are a large majority of these guys that cannot be trusted so you want to pay them as soon as possible and remove the car from their lot as soon as possible. I have had out of state agents call me in the middle of the night asking for the repo fee with threats and everything else and the car was just repod a day or so earlier. These agents may not work with finance companies so they expect payments the same day. Important to get the money to them western union if possible as you do not want your collateral in the hands of some of these types. It is the unprofessional side of the repossession game that is inevitable.
I can imagine these national forwarders dealing with this crap all day long. However surely after several years, you begin to know who you are dealing with each day in each state, but every now and then a city will pop up out of the blue that you don’t deal with anyone.