Hammer Time: Investments

Five years ago ‘financing’ was like a cuss word to me. I had spent the prior two years traveling around the country for an auto finance company liquidating 10,000+ repos annually. Seeing repossessed Ford Rangers with $600+ monthly payments and Kias given to anyone with a pulse made me very wary of that world. I stuck with cash cars and made a great worry free living doing that. That was until October 2008 when the cash customer literally disappeared from my landscape.

Since that time at least half my customers have been financed by yours truly. $500 to $700 down, $50 to $60 a week, for a 12 to 15 month period is typical for most of what I offer. I do have a few luxury vehicles that require longer loan periods. But typically my customers are simply looking for comfortable and worry-free A to B transportation. There are a lot of things I do to keep those folks happy… and honest.

The first is to catch little problems before they become big problems. On the payment front, I offer folks the opportunity to make their payment directly to a bank instead of at the lot. The bank that I use has long hours on Saturdays and is even open on Sundays from 12:30 to 4:00 P.M. The customers come by. Make their payment. Get a receipt with the company name showing the day, time and amount. Then call me so that I can confirm the deposit. If someone hasn’t contacted me by 3:00 PM on Saturday they will hear from me… in a decent and friendly way… and the process becomes far less problematic.

I do not charge late fees. Ever. I’ve always considered the terms usurious and surprisingly, I’ve found that you can get a far better return from referrals and the general willingness to work with people in their tight periods. There are some customers who have given me a five figure return through the referrals. Most others simply tell the truth. A few others tell convenient lies. It’s not a perfect world and in times of difficulty you also have to be willing to ‘pull the trigger’ and get your car back.

The trigger depends on any combination of three things. Do they pay? Do they tell you the truth? Do they return your calls? If #1 doesn’t happen, then either #2 or #3 will result in a repo. Some folks need the shock value of seeing the car gone before they are scared straight into paying. I’ve had people who mysteriously lose their cell phone come up with several hundred in cash within 24 hours. People who think by moving they can’t be traced. Kids who think they can keep on milking their parents for all the payments. Even con artists and drug runners who think they are beyond the reach of anyone. A $100 transponder can go a very long way to getting your asset back. And there’s one other thing…

I always pay a premium for experience. This comes to advertising, repairs, and most especially repos. My repo guy also happens to be a preacher at a nearby church (no I’m not making this up) and his powers of persuasion and ability to figure out people is amazing. I pay him a bit more than other folks typically do, and often times I not only get the car back, I get the key and a cleaned out interior as well. Most places pay a repo guy in 30 days. The big companies wait until 90 days or never. He gets it on the very day and I go out of my way to help him with anything he needs. In the new economy, it’s the collectors and the protectors that can save your skin.