Car Wars: Luxury vehicles filling repo lots

SAN JUAN — Luxury automobiles languish in Allen Weaver’s dusty repossession yard.

Several Cadillacs, a Range Rover and even a Hummer SUV wait to be hauled off by lien holders.

Before the recession hit McAllen, Weaver Asset Recovery repossessed about 25 to 30 cars a week — not many of which were luxury models.

They now repossess more than 60 cars a week and have raked in $300,000 in fees from lien holders since January, Weaver said.

And as the number of delinquencies increases, Weaver is repossessing an unusually large number of high-end cars.

“We’re seeing a trend of bigger, more expensive, gas guzzling vehicles,” he said.

Weaver pulled in six Corvettes in a week, had four Hummers in his storage yard at one time and recently repossessed a $160,000 Audi R8.

“You never see those vehicles normally because these people are doctors and lawyers,” said Octavio DeLeon, a Weaver repo man.

The owners often become “rowdy” because they lose a symbol of their supposed wealth, DeLeon said. People lock their cars in garages, hide them and try to pass them off to friends and relatives.

Experian Automotive, a global market research group, estimates 30-day delinquencies on auto loans increased more than 11 percent nationwide in 2009, while 60-day delinquencies increased almost 20 percent.

While the Rio Grande Valley has escaped the worst of the nationwide recession, it has not been spared completely. The McAllen metro area economy contracted 9 percent over the past year while unemployment rose 3 percent, according to the McAllen Area Economic Pulse, an economic index published by the McAllen Chamber of Commerce.

The Pulse goes on to report that auto sales in the McAllen area have dropped 28 percent since last year.

The state’s “self-help” repossession laws, meanwhile, tend to favor repo agents.

Agents can repossess a vehicle even if it is parked on private property. They don’t need a court order, and the police can’t interfere as long as the agents don’t cause a disturbance.

Furthermore, the actual lien holders have no obligation to inform debtors of an impending repossession.

Texas law may benefit repo agents, but lien holders are becoming flexible as delinquencies rise. Although financing for new autos dropped 10.7 percent nationwide this year, people with delinquent loans do have options.

“Sometimes people are in a better position than they think they are,” said Israel Silva, general manager of Clark Knapp Honda in McAllen.

If you run into trouble with your auto payment, you should speak with the dealership or bank, Silva said. The dealership may buy the car back, and many banks are willing to reduce or reschedule payments.

Above all, it is best to cooperate if repossession becomes a possibility, because resistance will reduce the chance of a deal with the lien holder.

“If you are late on your payments, the worst thing you can do is hide from the repo man,” Weaver said.

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Spence Kimball covers general assignments for The Monitor. He can be reached at (956)683-4423.