Economic downturn leads to pickup in repossession business
The words "car repossession" may conjure images of a man with a slim-jim breaking into a car late at night. But the modern repo man has come a long way, aided by the latest advancements in technology.
Trucks used by San Diego Auto Recovery would make any technology buff proud.
Vehicles are mounted with two cameras that use license plate recognition technology, which is also used by Border Patrol agents.
A mounted laptop and GPS navigation system in the vehicle allows Larry Reeves, owner of San Diego Auto Recovery, and his field representatives to instantly download a wide variety of information on vehicles, owners and delinquent payments.
"We used to have a stack of 50 sheets of paper with notes scribbled on them, but technology has made the search a lot easier," said Reeves.
While there have been many technological advances in the industry in the last 60 years, Reeves says the inherent danger in repossessing cars remains the same.
"People are very angry. That's all they have left and they want to hang on to it," he said.
When people get physical with repo men, the company is required by law to file a Notice of a Violent Act with the California Bureau of Consumer Affairs.
In better economic times, Reeves would file a notice on 1 percent of all repossessed cars. Now it's 3 to 4 percent of all cases.
Former car owners even track their vehicles to Reeves' office to recover personal belongings, berate his employees and, on rare occasions, steal their cars back.
"Once, a man climbed over the razor wire and was severely injured. He got back in his car and smashed out the gate," said Reeves.
The danger forced Reeves to install bulletproof glass and security cameras in the company's facilities, which are purposely inconspicuous. No signs are visible from the street.
Requests for repossessions are on the rise across the area. San Diego Auto Recovery has seen a 15 percent spike in repossessions in the last year compared with normal years.
The highest number of orders for repossessions in North County are concentrated along the Highway 78 corridor from Oceanside to Escondido and up to Fallbrook, said Reeves.
"There's a higher ratio of transients, meaning people move faster," he said. "There are a lot of apartments up there and I think it's a contributing factor."
Reeves also believes the frequent moving of members of the military and college students leads to more cars being lost.
In another troubling trend in the economy, Reeves has recently seen more orders to repossess small-business vehicles such as large tractor trucks, for which he had to contract outside help in towing heavy vehicles.
While the repossession business may seem recession-proof, the company still feels the effects of the weak economy.
"The spike in fuel costs hits our bottom line." Reeves said. "And now the major banks are negotiating fees, so there's still a trickle-down effect."
Larry Reeves began his career in repossession in 1973 when he worked for a towing company.
He recalls when an irate car owner knocked him out cold.
"He hit me in the back of the head and I didn't wake up until 10 minutes later" he said. "The guy tried to take his car back but he couldn't undo the straps."
In 1977, Reeves started his own towing and repossession company. But the housing boom at that time inspired him to sell real estate. When boom turned to bust in 1984, he returned to repossessing cars, driving a tow truck by night and struggling to sell real estate during the day.
Since then, he's enjoyed steady growth. His company employs 14 people, including his two daughters.
He says he believes his company allows financing companies to recover costs -- often by reselling the vehicles -- so that other car buyers will be able to get auto loans.
And despite the potential danger, Reeves still drives his truck and repossesses automobiles.
"I still like doing what I do. It's my job and I do it better than anybody," he said.
Posted in Business on Friday, July 24, 2009 12:00 am Updated: 10:45 am. | Tags: M.repomantwo.24, Nct, Business, Local, Z.google.business
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