Finance Companies

Saturday, March 20, 2010

How Finance Companies Are Easing Policies to Prevent Repossessions

Power Vegetables In A Drink

Click this now

With the current economic conditions the way they are, many finance companies and banks are taking active steps to help keep their current customers from losing their cars to repossession.

These steps can often involve either extending the time lenders allow before beginning the repossession process or restructuring payments plans to make them more affordable.

According to Rich Apicella, practice manager of Benchmark Consulting which teaches collection agents for finance companies to understand the reason for a person's delinquency on an account, and then come up with a plan to avoid repossession.

"Auto finance sources have an average net loss of about $6400.00 on repossession, so it is in the company's best interest to keep customers in their cars." "The first thing is to identify why the customer is delinquent. Is it a job loss, health problem, divorce or decline in income?

Once the collector knows what the problem is, he or she can help the customer develop a payment plan. Sometimes, this requires an extension in the payment plan, other times they delay the next few payments and other times they help negotiate a short sale of the car," says Apicella.

Even though finance companies are easing their policies to help people keep their vehicles, there doesn't seem to be a decline of total repossessions over all yet.

According to Carmel Ind based ADESA their statistics show the number of repossessed vehicles continuing to grow.

According to their research, there were 1.6 million repossessed vehicles in 2007 and 1.8 million in 2008. They are predicting between 1.9 and 2 million repossessed vehicles this year and next, and then a drop to 1.8 million in 2011.

So what does this mean to the consumer? Most lenders are looking for ways to keep you in your vehicle. If you are behind or think you may start to get behind contact you finance company right away. Explain your situation to them and ask for help.

Work with them to find a payment arrangement that you can afford until your financial situation improves. Do not avoid their calls if you are behind on your payments. If you do not contact them and ask for a solution then they cannot help you.

This author has over 20 years of automotive finance experience, specializing in auto loans with bad credit. You can visit http://www.autoloanswithbadcreditnow.com for other useful articles and to get approved now. Our lending partners boast a 99% approval rate. Get an approval in minutes.

Article Source: http://EzineArticles.com/?expert=Scott_Stanko

Labels: easing policies, how finance companies, prevent repossessions