You may have noticed an increase in the amount of repo cars for sale. The industry of car repossession, though generally a clandestine market, is a lucrative one. Because of the abundance of repo cars most finance companies (banks, credit unions, etc.) outsource most of their repossession work to the few firms that specialize in the repo car business. Most of them, which are run out of small offices or homes, have no need to even advertise because the volume of work provided by even just a few sources is usually enough to keep the repo cars coming in and the entire company in the green. With the current state of the economy the repo car business is booming even more than usual, (which is usually still a booming industry regardless of the economic climate because buying repo cars for sale is profitable.) Once the job gets done repeat business is pretty much inevitable. One client can provide enough repo cars to keep even the largest repossession company busy for weeks at a time. The cost to actually repo a car ranges from $150 to $300 on average. Considering the average repossession process can take anywhere from 20 to 45 minutes the dollar per hour ratio is enough to get anyone interested.
There are several markets for this industry, the most obvious being Banks and/or credit unions. Banks and Credit Unions do a majority of auto financing in the United States and have the greats need for repo car services. When the first payment is missed the collection department at the bank takes on the task of collecting the past due payments before repossession is even considered. Repo cars aren't of much value to the financial institution. If an agreement is unable to be reached between collections and the registered owner of the car then the next option is usually repossession. In most cases the collections department will even give the registered owner the chance to turn in the car prior to obtaining a third part to repossess it. Finance companies also do business very similar to the way banks and credit unions do, but because they usually charge a much higher interest rate and lend to more "at risk" borrowers, their rate of repossession is higher than a traditional bank so their need for companies to repo cars is greater.
Used car dealerships are another pretty consistent source of repo cars in more ways than one. When someone gets financed directly through the dealer it's usually a sign that they couldn't get financing anywhere else. A large percentage of these "high risk" car loans end up in collections and the car is repossessed. What usually happens is the car is sold for three or four times what the dealer paid for it and required a large down payment (probably enough to cover the actual cost of the car) then once it's reposed the repo cars are thrown right back on the lot and sold again at an inflated price. This is where all the repo cars for sale offers come from. A repo company working for a used car lot can potentially repossess the same car more than once. Because of the amount of repossessions outsourced by used car lots they usually try and get a repo company that will charge less than the going rate.
Repossession can be a lucrative business to get in to. It's not for everyone but if you enjoy it and you're good at it then repossession may be your niche. Be sure to check with your local secretary of state or licensing committee because depended on the state there may be special licenses need to run a repossession firm.