Lenders: Repossession the last option
WATERLOO --- Lenders say repossession is the last --- and least preferred --- option in dealing with a lapsed vehicle payment plan.
Veridian Credit Union in Waterloo reported a 38 percent increase in repossessions from 2008 to 2009 but also emphasized that its loan volume also rose 26 percent in that same period and that it is "on track" to finish the 2009-2010 period with a 10 percent decrease in repossessions.
Trina Becker, manager of collections at Veridian Credit Union in Waterloo, answered some questions about her institution's end of the process.
Q: Where are repos trending currently? New cars? Used cars?
A: The majority of our repossessed vehicles are used cars --- only about 6 percent of our repossessions are new vehicles.
Q: What, if any, effect did the so-called "Cash for Clunkers" program have on repossession trends?
A: The main effect of the Cash for Clunkers program was the prices repossession businesses received at auction for cars. Dealers were looking to put used cars back on their lots, so they were willing to pay a little more at auction for the vehicle, which helps in the recovery of losses on repossessions. This trend has since slowed down as more used cars are now in the market.
Q: How does the repo process work? What does Veridian do to try to work out avoiding a repo situation?
A: Repossession is our last resort. We don't want the vehicle to return, as it causes more loss for the member and for the credit union. At Veridian, we try to look at every member's situation separately and see if there is any way we can help them keep their vehicle. There are situations where the member just cannot afford the vehicle and repossession is the only option. In that case, if the member is cooperative, works with us and brings in the vehicle voluntarily, it will save on costs and expenses for everyone.
Q: How many repossession agents does Veridian work with?
A: Veridian works with several repossession agents throughout Iowa and out-of-state.
Q: How long does Veridian wait before contacting a repossession agent?
A: This varies on the member situation.
Q: What happens then?
A: Once the repossessor is notified of a vehicle that needs to be picked up, they find it, clean it up and prepare it for sale. Members are responsible for the remaining balance of the loan, as well as any repossession and clean-up fees incurred, even on a voluntary repossession.
Q: Does Veridian sell its repossessed vehicles?
A: Veridian currently sells vehicles several different ways. We send them to dealer auctions and public auctions that are open to anyone. We have sold them in our Swap Sheet and also online. We use several different dealer auctions in Iowa and out-of-state.
Veridian Credit Union in Waterloo reported a 38 percent increase in repossessions from 2008 to 2009 but also emphasized that its loan volume also rose 26 percent in that same period and that it is "on track" to finish the 2009-2010 period with a 10 percent decrease in repossessions.
Trina Becker, manager of collections at Veridian Credit Union in Waterloo, answered some questions about her institution's end of the process.
Q: Where are repos trending currently? New cars? Used cars?
A: The majority of our repossessed vehicles are used cars --- only about 6 percent of our repossessions are new vehicles.
Q: What, if any, effect did the so-called "Cash for Clunkers" program have on repossession trends?
A: The main effect of the Cash for Clunkers program was the prices repossession businesses received at auction for cars. Dealers were looking to put used cars back on their lots, so they were willing to pay a little more at auction for the vehicle, which helps in the recovery of losses on repossessions. This trend has since slowed down as more used cars are now in the market.
Q: How does the repo process work? What does Veridian do to try to work out avoiding a repo situation?
A: Repossession is our last resort. We don't want the vehicle to return, as it causes more loss for the member and for the credit union. At Veridian, we try to look at every member's situation separately and see if there is any way we can help them keep their vehicle. There are situations where the member just cannot afford the vehicle and repossession is the only option. In that case, if the member is cooperative, works with us and brings in the vehicle voluntarily, it will save on costs and expenses for everyone.
Q: How many repossession agents does Veridian work with?
A: Veridian works with several repossession agents throughout Iowa and out-of-state.
Q: How long does Veridian wait before contacting a repossession agent?
A: This varies on the member situation.
Q: What happens then?
A: Once the repossessor is notified of a vehicle that needs to be picked up, they find it, clean it up and prepare it for sale. Members are responsible for the remaining balance of the loan, as well as any repossession and clean-up fees incurred, even on a voluntary repossession.
Q: Does Veridian sell its repossessed vehicles?
A: Veridian currently sells vehicles several different ways. We send them to dealer auctions and public auctions that are open to anyone. We have sold them in our Swap Sheet and also online. We use several different dealer auctions in Iowa and out-of-state.
