Why You Should Use a Professional Repossession Company
- November 30, 2006
- by PInow Staff
Any company holding a security interest in an asset on which payments have not been made can choose to repossess to recover the property. However, choosing the right repo service is a must to ensure a legal and hassle-free repossession.
No one likes repossession. Customers do not like having their possessions taken away and companies do not like having to hire companies to seize products on which payments have not been made. Although companies and customers alike face stress and added costs with repossession, new information shows that more companies and businesses are being pushed to repossession orders. Statistics published by the Administrative Office of the U.S. Courts, new bankruptcy filings jumped 5.7% in 2002 up to 1.57 million from 2001 alone. The Department for Constitutional Affairs reported in 2006 that repossession orders related to unpaid mortgages were the highest in 9 years.
The Repossession Process
Repossession usually occurs either because an asset is being paid for in installments or is being used as collateral when payments are not made. For example, if a customer buys furniture on a payment plan, they may not officially own the items until all payments have been made. The store can repossess the purchased items if the customer stops making payments.
Even in cases where a customer already owns an asset, it can be repossessed if the item is being held in collateral. For example, in many debt consolidation home equity loans, a homeowners property is held as collateral. If the homeowner stops making payment on the loan, the lender can, in many cases, repossess the home. Basically, a company can repossess any property on which the payments have not been made, provided that the company holds a security interest in the asset.
Choosing a Repo Business
Any company losing money through non-payment may want to consider repossession. The best way to reclaim assets on which money is owed is through a professional repossession company. A professional service will ensure that the repossession is legal and effective. Companies looking to hire a repossession company need to look for:
- Repossession companies who are affordable. Repossession professionals range in price quite widely. Since companies in need of repossession services have usually already lost money through non-payment, choosing a service that is affordable and effective is important.
- Repossession companies that are bonded and have wrongful repossession insurance. Insurance helps protect the company in case a lawsuit results. Companies should look for companies with additional insurance that can offer some protection in case the assets are damaged during the repossession process.
- Repossession companies that have the licensing requirements for your state. New Hampshire, North Carolina, Massachusetts, and Vermont do not require repossession licenses. California, Maine, Pennsylvania, and Louisiana all have strict licensing requirements. Companies hiring repossession services in states where licensing requirements are in place need to ask for license numbers to verify that repo agents comply with state law.
- Repossession companies who have agents familiar with local law and the repossession process. Experienced, local repossession agents are a must, since criminal violations and breaches of peace can be alleged, especially in cases where an owner resists repossession. Repossession agents need to be knowledgeable enough to avoid accusations to illegal repossession and trespassing.
- Repossession companies who have good standing with the Better Business Bureau.
- Repossession companies who have investigative resources. If a company thinks that an owner may remove an item about to be repossessed and in cases where an owner may try to move away to avoid repossession, companies should look for services that can track down as well as recover the assets.
While some companies think that they can repossess any items on which payments have not been paid, hiring a professional repossession service is the best option. A professional service can help companies avoid legal hassles, illegal repossession, and other problems. Hiring a good repo service is one of the best things that companies can do to get business back on track. The PInow.com Worldwide Directory of Private Investigators can help any business find a local repo service that can recover assets quickly. Thanks to the PInow.com Worldwide Directory of Private Investigators, companies can also quickly access free repossession resources.
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