RALEIGH, N.C. -

Regulations force remarketing of repossessed vehicles to take a certain amount of time, but Consolidated Asset Recovery Systems believes its two newest partnerships can allow lenders to use that time as efficiently as possible.

Geared to leverage potential both on the wholesale and retail fronts, CARS recently forged relationships with Copart and Asset Nation to set up virtual bidding processes aimed at exposing the units to potential buyers as they’re working their way over legal and remarketing hurdles.

“There’s always been a lot of pressure from the lenders once (the repossessed vehicle is) picked up to get it to auction and get it sold as quickly as possible so they can get their money,” CARS president and chief executive officer Steve Norwood explained to Auto Remarketing.

“Just from the sheer process side of it, there’s only but so fast you can move. It can’t leave the agent location a lot of times for five to 10 days. There’s transport time. Condition reports have to be done. But they were looking for ways to shorten the process,” Norwood continued.

“This became the opportunities to be able to do that,” he added.

CARS’ Relationship with Copart

To enhance the wholesale process where repo units typically are remarketed, CARS spent 18 months in dialogue with Copart to create an upstream model that’s all completed online. Dealers now can participate in a Right to Cure Auction.

Norwood explained once pictures are taken and a condition report is compiled, dealers can scour the listings and make their highest, sealed bid during an auction that can last anywhere from three to seven days.

If the lender thinks the highest bid meets their price goal for the unit, the vehicle is awarded to the dealer with the winning bid. The dealer can pick up the vehicle at the nearest Copart location as the company has about 130 sites nationwide.

“The neat thing about it is if it doesn’t sell, there’s no cost. So there’s really no barrier for allowing a lender to go out and market these things during the process,” Norwood emphasized.

“The cars can’t be sold until after the clear-to-sell date. But lenders can actually start taking bids,” he continued.

“Everyone we’ve talked to has said, ‘This is great,’” Norwood shared. “It’s given them an alternative to the traditional auction process that really wasn’t available before.”

The CARS boss also stressed how important it is to have Copart as a part of the process rather than dealers having to go to the repo agent’s site to finalize the purchase.

“Copart has been a great partner,” Norwood told Auto Remarketing.”Their whole infrastructure is designed for doing online transactions. And they’ve got facilities where they have people to clean up cars, take pictures and handle the title work. That’s where the buyers can pick up the cars.

“We knew we wanted to have a neutral ground to complete the transactions and with someone who knew how to deal with title issues and working with buyers. Copart is a great partner for that,” he added.

CARS’ Agreement with Asset Nation

For lenders that opt to pursue the retail-buyer market to recover money on repossessed vehicles, CARS chose to broaden its relationship with Asset Nation, a company that traditionally has remarketed construction, farm and industrial equipment.

Norwood indicated CARS used Asset Nation to help lenders sell boats and other non-vehicle collateral. But since Asset Nation is increasing its whole-car pursuits, Norwood believed it would be a good fit for CARS’ efforts to push lenders’ recovered vehicles to retail buyers.

The process works similarly to CARS’ deal with Copart on the wholesale side. Bids are made online. But the vehicle stays at the agent location, and any storage fees that may be incurred while being there are worked into the deal.

Once a bid is accepted by the lender, the vehicle is shipped from the repo agent’s yard to wherever the buyer wants it.

Unlike the wholesale auction that spans less than a week, Norwood indicated lenders can choose to extend the bidding process for a longer time, even a month. Norwood explained how creating a path to remarket repossessed vehicles to retail buyers caters to particular client segments that requested it.

“A lot of lenders have instructions to sell only to wholesale auctions. They don’t want to deal with retail buyers at all,” Norwood said. “But a lot of the credit unions and smaller finance companies do want to get exposed to retail buyers because they can get a higher value for the asset.

“The credit unions, unlike the traditional banks, tend to sell these cars to their members or you’ll see cars for sale outside of credit unions,” he continued. “This becomes another way for them to promote the asset.”

Norwood added plans already are in motion for CARS and Asset Nation to create a private-label site for credit unions to list repossessed units.

Recent Partnerships Key to CARS’ Growth

Norwood insisted the two agreements CARS reached with Copart and Asset Nation are vital to how his company can respond to industry changes and lender requests.

“As a company, we’ve always looked at ourselves as one that’s supporting the lenders and providing good services by building an agent community that’s the best one out there and providing online technology for selling assets and managing the remarketing process,” Norwood noted.

“We really look at ourselves as a store-front for the lender to be able to go to one place and get the service they need relative to the repossession and remarketing process,” he insisted..

To hear more from Norwood, he will be joined by several other high-level executives at the brand-new Re3 Conference — Recovery, Repossession and Remarketing — which will kick off on the morning of Nov. 16 with an overview of the recovery and repossession industry featuring key players sharing their perspectives on the industry and its future.

For a complete agenda, visit www.autoremarketing.com/re3 and click on “Agenda.”

The Re3 Conference is a half-day event produced in partnership with the National Remarketing Conference and the Certified Pre-Owned Forum as part of the Used Car Week, Nov. 14–18 at Red Rock Casino, Resort and Spa in Las Vegas.

For those attending the NRC or CPO events there is no additional charge to attend the Re3 Conference. Individuals not registered for either of the other Used Car Week conferences may register for the Re3 event for $295.

All three events will be held at the Red Rock Casino Resort and Spa in Las Vegas. Auto Remarketing has secured a conference room rate of $200 per night, available when rooms are reserved by Oct. 21. Visit www.autoremarketing.com/re3 for more information about the event, to register or to make hotel reservations.