Posted on 11/30/2005 11:04:29 AM PST by JZelle
NORFOLK -- The repo man may be getting the hook. An electronic device that attaches to a car's ignition system easily can take the place of a tow-truck repossession, and the units are finding their way onto high-risk car lots across the country. No pay, no start. It's worked wonders at Norfolk's Patriot Auto Sales, where nearly every car that is driven off the lot is outfitted with a PayTeck Smart Box, a system that hands over a five-digit code in exchange for each payment. Come due date, the car won't crank until the customer punches the code into a palm-size keypad wired into the dash. Patriot is the kind of operation that specializes in steeper interest, high-risk car loans. It advertises "no turndowns" -- a corner of the used-car business that deals with a "credit-challenged" clientele, as the industry puts it. "Bad credit?" asked Art Madden, Patriot's general manager. "I'd be happy if they just had bad credit." Not surprisingly, default rates are high. It's not unusual for more than a third of the cars sold off such lots to wind up being repossessed.
(Excerpt) Read more at washingtontimes.com ...
This is like the RIAA thinking that they can code their way around pirates.
....And it was such a good movie, too..........
How hard could it be to bypass it?
The life of a repo man is *always* intense.
Hmmmm. If this goes nationwide it will not be very long until the there will be a market for a device to defeat it at half a payments cost.
You never know if you're gonna come home after work.......
I would say not very!!!
life of the repo man does not include evenings with the family....
I am guessing it would be possible to bypass any add-on.
The people in that market are generally not the most technologically adept.
This could be a powerful motivator not to blow your paycheck on the slots...
While this gadget may be new, the practice of easy credit terms to people with limited to no means on used car purchases is hardly new.
This is a scheme I first came across in the deep south in Florida. It involves opening a combination salvage yard and used car lot on the same premises and cannibalizing a few cars that are still cosmetically acceptable.
The next step is to get a downpayment from the buyer which covers the dealer's entire investment and setting up payments on a weekly basis which have a no-grace repossession clause.
Critical to this is for the buyer to document a local address and a nearby relative to whom the dealer can go to get information in the event of a (likely) default.
Since the dealer is assured of not losing any money on the sale of the broken-down vehicle in the first place, he takes almost a zero risk from the start and stands to gain if (when) the buyer defaults since he has repossession rights.
Once repossessed, the more ethical of these con men would renegotiate the terms of the contract, waive the repossession fee and set up a new contract for cash thereby selling the same vehicle to the same buyer twice.
The shadier sort would hound the relative for payment of the total ticket and threaten them with legal action if they didn't make good for the black sheep in their family.
As it turns out, consumer protection laws changed the complexion of this practice a bit and now we see different strategies invoked whereby the buyer is kept on the hook as long as possible and the vehicles must be at lest semi-roadworthy.
Barnum's axiom remains in effect.
That's not going to make the repoman obsolete. Reposession isn't just about the customer not being able to use the car, it's also about getting the car for resale.
Just don't sell the defeating device to anybody on credit.
One of our customers is a used car dealer that specializes in high risk customers. He jokes about selling the same car multiple times...
Seriously, he figured out that the primary reason customers stopped paying was that the car stopped running. He figured out a way to bundle a maintenance contract and an insurance contract with the car when he sold it, kind of like the way an escrow account on a mortgage is set up. The buyers had to pay more and his administrative costs were higher, but he cut his default and repossession rate by over half.
They have their mechanic friends take the devices out.
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