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Vehicle Repossession Holding Steady Despite Economy

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  • Vehicle Repossession Holding Steady Despite Economy

    http://www.republicanherald.com/site...d=532624&rfi=6

    Republican Herald April 1, 2008

    While homeowners might be losing their properties due to economic difficulties, the same is not true for automobile owners, according to local dealers and a national organization of vehicle repossessors.

    “It’s about the same,” said Don Wall, owner of Don’s Auto Sales & Repairs, East Norwegian Township. “We work with people.”

    “Ours have been decreasing,” said Scott Mitchell, a salesman for Ed’s USA Auto Rentals, Pottsville.

    Businesspeople say it is not in their interest to repossess vehicles, and that they will do whatever they can to help their customers keep them.

    “The banks have done everything in the world to prevent repossession,” said Les McCook, executive director of the American Recovery Association Inc., Irving, Texas. “They’re doing everything they can to keep people in their cars.”

    Many local dealers, in fact, do not involve themselves in the process.

    “We don’t repossess any vehicles,” said a spokeswoman for Rottet Motors Inc., Tamaqua. “Once the contract’s assigned to Ford Credit (Ford Motor Credit Co.), they’re responsible.”

    “We do no vehicle repossessions,” said a spokesman for Boardman Brothers Motor Car Co., Cumbola.

    Local dealers that repossess vehicles agree that repossession often is more trouble than it’s worth, and that both sides profit if repossession is avoided.

    “I try to work with people,” Wall said. “If they’re honest with me, I’ll give them a break.”

    But that approaoch has its limits, he said.

    “If they’re pulling my leg, it gets (repossessed),” Wall said. “I don’t care if it’s a little one or a big one.”

    Necessity also plays a role in the lack of repossessions, since for many people, the vehicle they have bought or leased at Ed’s is their only one, Mitchell said.

    “People need to get to work,” he said. “They just seem to be following the rules a little more.”

    However, Ed’s does not hesitate to take back a vehicle from someone who has defaulted on a contract, Mitchell said. It will charge a defaulter $125 for a local repossession and $175 for a more distant one, he said.

    Repossessions tend to be cyclical, with January being the worst time due to Christmas overspending and weather problems, McCook said.

    “People catch up on past-due payments” when they get their tax refunds, so repossessions tend to drop in March and April, said McCook, whose organization was founded in 1962.

    June also tends to be a big time for repossessions, with August seeing an improvement, he said.

    “You just kind of ebb and flow with the recoveries,” McCook said. “This is nothing extraordinary.”

    Pennsylvania doesn’t keep track of vehicle repossessions, either statewide or by county, according to Daniel Egan, assistant press secretary for the state Department of Banking. The department licenses collector-repossessors, which are companies that perform repossessions for other businesses, but businesses are allowed to perform their own repossessions, and the department does not license them, Egan said.

    Whether a collector-repossessor or a company that repossesses its own vehicles, all such businesses are bound by Pennsylvania’s Motor Vehicle Sales Finance Act.

    Under that law, the dealer or the holder of the installment sales contract has the right to repossess the vehicle of a buyer who has defaulted on the contract.

    The dealer or contract holder does not have to go to court to repossess a vehicle, as long as the repossession can be done without a breach of the peace. However, if a repossession cannot be done peacefully, the dealer or holder may file a lawsuit, called an action in replevin, to obtain the vehicle; if it wins, then a public official must perform the repossession.

    Once it repossesses the vehicle, the holder must retain it for 15 days after mailing notice of the repossession to the buyer. During that time, the buyer may regain the vehicle by paying the entire unpaid time balances, any default charges and, if he or she has been in default for more than 15 days, the holder’s costs of retaking, repairing, repossessing and storing the vehicle.

    After the 15-day retention period, the buyer loses all right to the vehicle and the holder may resell it privately or publicly.
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