Lenders that need to liquidate repossessions should look to private-party vehicle sale websites, such as Shift Technologies Inc., Blinker, and TRED — in the face of declining recovery values at traditional auctions, said Scott France, president of Loan Portfolio Servicing, an Innovate Auto Finance company.
“I service loans for about 20 different clients, and they all started screaming at me about two months ago: ‘You’re causing my losses to go through the ceiling.’ I’m not doing anything, I’m just selling their cars,” France said at the Auto Finance Risk & Compliance Summit last week. “The used-car market has gone down over the last six months and losses are going to go up. So, how do you get rid of cars?”
Online startups can be used as alternative sales channels that lenders can utilize to liquidate vehicles upstream.
“Can we get more money? I don’t know, but it puts [the cars] in front of more buyers, instead of just physical bodies looking at auction or looking at them in simulcast,” France told attendees.
Another benefit to listing cars for sale online is having vehicles viewed in multiple places without having to physically transport them to different auctions, he said.