Tag Archives: repossession

leased car

Can a Leased Car Get Repossessed?

Approximately one out of four vehicles is leased each year. While this option isn’t for everyone, it can offer benefits such as lower monthly payments, lower maintenance costs and the option to get a new vehicle every few years. But what happens if the lessee stops paying on a leased vehicle? Can it get repossessed just like owned cars? 

The short answer: Yes. If a person is currently leasing a car and can’t afford the payments, it can be repossessed. Let’s explore more about repossessing leased cars. 

What Happens When the Lessee Stops Making Lease Payments?

When a person leases a vehicle, they’re making an agreement with the lessor (or the company they’re leasing the car from) to make their payments on time. If they don’t, it’s a breach of the lease, and it will trigger the lessor to send a tow truck to come and get the car. It doesn’t take much for this to happen. Usually, just a couple of missed payments can get the vehicle taken away. 

Now, when a lessor takes the car away, is this the same as repossession? Yes, it is. If the lessee doesn’t authorize the option of having their car repossessed, it’s referred to as an “involuntary repossession.” If they do volunteer or authorize having the car repossessed, it’s called a “voluntary repossession.” 

Either way, it’s not a happy situation because it can cost a lot in fees such as: 

  • Early termination fees
  • Remainder of lease payments 
  • Past-due payments 
  • Excess wear-and-tear and mileage fees
  • Cost of repossession 
  • Cost of resale 

Is it Common for Cars to be in Repossession? 

Repossessed vehicles are not uncommon, especially in this day and age where the average new car costs roughly $47,000. If you face any type of hardship, it’s going to be very difficult to make these payments on time. According to recent data, roughly 2.2 million vehicles were repossessed in 2021

What Happens When Cars are Repossessed? 

When a repossession happens, the owner typically has the opportunity to make up the payments and take back the vehicle. If they’re unable to do so, the lender will take possession and sell the car, usually through an auction. This is beneficial for the public community because they can purchase repo cars for a fraction of the price. 

However, many auctions are not public and require a dealer’s license. RepoFinder does not. We are the largest bank repo list in America, with links to thousands of lenders selling bank-owned vehicles. Browse our selection of repo vehicles today, including previously owned and leased cars in good condition! 

SUV car

How Do I Buy a Car from RepoFinder?

If you’ve landed on our website, you’re probably shopping around for a car and looking for a great deal. We’re the place to make this happen! Our website offers a full list of banks and credit unions that are selling repossessed vehicles. (You can learn more about repossessions here). Even though the banks take these vehicles back, they don’t care to keep them. This is why they sell them to dealers or the general public. 

Many banks and credit unions choose to sell their repo inventory to dealers because they can get rid of many vehicles at once. Unfortunately, everyday people who are looking for a discounted vehicle aren’t able to access this inventory. But, you’re in luck! RepoFinder only sells to the public. This allows you to purchase repos directly from the source.

What are the Steps to Buying a Vehicle from RepoFinder? 

Whether you’re shopping for a car, truck, SUV or recreational vehicle, RepoFinder has it all. We even get small aircraft and boats! We’ll walk you through the process of buying a repossession so that you know what to expect. Please note that each bank and credit union has their own process for selling repos, so there may be some slight differences. 

View our list of repossessions

Start with our USA map and click on your state. This will pull up all of the banks and lenders that sell repo inventory. Because banks are always getting new vehicles, check back often if you don’t see something you like right away. Repo sales require patience! 

Make an offer 

When you find a vehicle that fits your needs and price range, you can make an offer. Most repos are priced by the bank based on the vehicle’s book value or recent appraisal. However, don’t be afraid to offer less. 

Sometimes you can see what other people are offering (open bid) and sometimes you can’t (closed bid). Open bids are more common because you can compete with others. You can give your offer verbally over the phone or by filling out an online form. 

Inspect the vehicle 

If your bid is accepted, it’s important to do your due diligence. Only work with sellers who are willing to let you inspect the vehicle. You may not be able to take it for a test drive, but you should be able to look at its condition. Remember, you don’t get protection with a repo, so it’s yours to keep once you drive it off the lot. 

Purchase the vehicle 

Once you’re comfortable with the purchase, you can proceed with the sale. The benefit to working with the banks is that you can get financing directly from them. In fact, banks are often willing to negotiate better pricing, terms and interest rates when you buy direct. And, you don’t have to deal with pushy salespeople working for commission. 

Hopefully you can see how easy it is to buy a car from RepoFinder. Remember these three things: be patient, do your homework and check back often. If you keep these things in mind, you should have no trouble finding a great vehicle at a fantastic price! 

Kelley Blue Book values

How Accurate is Kelley Blue Book?

If you’re considering buying a repossession, it’s a good idea to familiarize yourself with Kelley Blue Book (KBB) values. Given a history of over 90 years and millions of unique visitors logging onto the site each month, KBB is one of the most popular and trusted guides for automotive pricing. It can also be incredibly useful when placing a bid on a repo car. But, how reliable is KBB? 

Let’s go over the basics of how KBB determines used car values, some issues with pricing to think about and solutions when placing a bid on a repo car. 

How KBB Decides Used Car Values 

Kelley Blue Book regularly receives car prices from wholesale auctions, car dealers, rental fleets, auto manufacturers and private party sales. It uses a sophisticated algorithm to analyze pricing data, historical trends, current economic conditions, time of year, location and industry developments to come up with an accurate value for each vehicle.

Here are the different values each car is given. 

  • Private party value. This number tells you how much you can expect to pay for a vehicle through a private seller. 
  • Trade-in value. The trade-in value is the amount you’re likely to get when trading in your vehicle.
  • Suggested retail value. This is the price that car dealerships are usually asking for a vehicle.
  • Certified pre-owned value. Cars covered under certified pre-owned fall into this category.

As you can see, KBB takes many factors into consideration when determining the value of today’s vehicles. However, there is still a lag that must be accounted for, as it takes time to collect and analyze the data. It’s possible that the latest trends and economic conditions aren’t being accounted for in the latest number. Other than this, you can expect Kelley Blue Book to be a good benchmark for your bid. 

Tips for Bidding on a Repossession 

When you find a repossession that you want, the next steps are to inspect the vehicle and place a bid. Here are some tips that will help you place a strong bid.

  • Consider other sources. KBB is great, but there are other options as well. Check out the NADA Guide (the yellow book) and consumer reports. Compare your findings for the most accurate price. 
  • Negotiate. There is usually some room to negotiate when buying a repossession. Banks and lenders want these vehicles off their books and some will go below the KBB value. 
  • Set a limit. Know what you’re willing to pay for the vehicle. When multiple people bid on a repossession, it can drive up the price. Don’t let the excitement of winning a bid cause you to pay more for a car than you need to. 
  • Choose a bank or lender. Although you can bid through an online auction, it’s better to work with a lender or bank. You can get financing through this seller, which gives you more negotiating power and better terms. 

The Bottom Line

Kelley Blue Book is a great resource, but it’s not the only one out there. Be sure to consult other resources, establish a limit and do a thorough inspection. This way, you’ll be confident when it comes time to place a bid. To browse repossessed cars, trucks, RVs, boats, etc. in your area, visit RepoFinder.com. It’s FREE!