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Oct 14, 2008 12:00 PM
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Vehicle repossessions are expected to rise 15% this year from 2007 due to the continuing economic meltdown, says an executive vice president of customer strategies at ADESA Inc., a vehicle auction company, in Automotive News today. So why are repo men complaining? Apparently banks and lenders are facing so many delinquent loans that they're far more willing than usual to renegotiate the terms of a contact or tolerate missed payments than they used to be. Since lenders like GMAC and Ford Credit lose an average of more than $10,000 on a repossession, they have a strong incentive to avoid the repo man — and apparently they're doing just that.
Newer, more expensive vehicles are making up a larger share of the repossession business this year also, adding to the loss incurred when a loan goes bad. Full-size SUVs and luxury vehicles are more common than ever on repo lots according to the report, with many of those vehicles coming from folks who had excellent credit.
Recent cutbacks in the number of loans granted and the discontinuation of leasing by many lenders are expected to cause more lean times ahead for repo men — even during the worst economic downturn in recent history. Guess it's true that no one's safe. [Automotive News, Sub. Req.; Image Credit: Cinematical]
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