Primeritus Financial Services, Inc. who made headlines by it’s acquisitions of Renovo, USA Recovery, and Skip Master in 2012, sent new service agreements to their network of recovery agents on Tuesday March 12,2013 that includes language giving Primeritus, or 3rd parties of their choice, complete access to recovery agents yards, offices, records, and Primeritus’s clients recovered vehicles. Agents must agree that they will never hold or detain any vehicle for any reason and must waive any right or remedies at law, including any lien or additional costs, that would obstruct Primeritus, or 3rd party of their choice, from taking the vehicle.
Also included in the new agreement are provisions that recovery agents may not charge for storage of vehicles or personal property unless by special instructions by Primeritus or their client. Another section states that unless precluded by law, all personal property must be made available to Primeritus.
While Primeritus did lower it’s recovery fees by only a few dollars, Primeritus increased it demands on the agents by increasing free vehicle storage to 20 days, including standard cut keys at no charge, and transporting the vehicle, if not redeemed by the debtor, to the auction for free for the first 30 miles.
Additionally, Primeritus included assessable fees on the agents. A $75 dollar fee could be assessed if Primeritus wanted to audit the agent’s yard, a $250 fee could be assessed if the agent failed to remove all contents, including garbage, from the vehicle before it arrived at the auction. Fees may be charged to the agent’s receivables, allowing no form of redress for the agent.
Primeritus also rolled out it’s “Fast Cash” discount program offering faster payment times on recovered assignments. The “Fast Cash” discount program offers payment in 7 business days for a 10% recovery rate fee (agents would be paid 90% of the recovery rate), 14 business days at a 5% fee, and 21 days at a 2% fee.
What may just be bad timing for Primeritus, the “Fast Cash” discount program came out just one day after the announcement by Secured Collateral Management to offer same day payments to their agents without any fees or deductions.
As agents across the Country read the new agreement, reaction has be mixed with many comments using words like “Chase-like” ,referring to last years JP Morgan Chase agreement that would have made agents responsible for damage to a vehicle at full vehicle value, and “Renovo’d” in reference to the failed micro-managed tactics placed on agents by Renovo.
Some greedy folks in this business.
Rs is too busy st care about anything other then
Knocking fees even lower sent some bs
Asking to lower fees to 285 ….WHAT ?????
Well what can you say, this is the free enterprise system. They can ask for anything, BUT THAT DOESN,T MEAN THEY ARE GOING TO GET IT. It is up to every professional repossessor to help Phil and his managment team understand our side of the story. You can’t blame them, in the past WE/US gave up and just caved in. But now with all the compliance issues we are going to have to buy into they are not going to have an ocean of PROFESSIONAL RECOVERY AGENTS.
IF YOU ARE WORKING FOR THIS CLIENT, SAY NO!
Here we go again, instead of collecting from the debtor who owes this in the first place. They are choking the life out of the people helping them.
Its NOT about greedy companies,it is very very simple.If you as a repossession company owner cater to these companies and accept these types of contracts,you deserve what you get.STOP allowing these companies to pimp you.If YOU say NO,what are they going to do?? Go to a mediocre agency?? Then,when they are dis-satisfied,and they come back to you…..you charge them what you would otherwise charge.It is all in your control…..if you allow it to be.Ken.
How embarrassing it must be to have to admit that you actually work under those conditions.
I hear that Primeritus is already getting an ear full on this deal and are taking another look at it. Not sure if they will Change it or not.
I have done work for Primeritus and they have always treated me fair. They had good paper and up until now, the demands have been balanced and fair.
I am a firm believer that there are both good and bad forwarders, just as there are both good and bad repo people.
When I first started working with them, they had just purchased Renovo and I was very concerned if they would stick to their way or if they would become like Renovo. They assured me that they would not be doing business like Renovo had.
I can honestly say that up until now they have kept that word and it has been a very enjoyable relationship. Maybe they just got too big too fast and have forgotten who got them there. Whats the ol’ saying in the repo business? Speed and Greed always equals Crash and Burn. I am not sure what they are going to do about this new contract. I guess I will have to wait and see like the rest of us. I know I will not sign it. If they keep their current agreement in place, then I am happy to do their work. If not, well then we will have part ways.
Everyone be safe and profitable!! Hope to see you all at the Florida Tow Show/Repo Expo and at NARS.
There is only one contract I will ever sign… It is called the “industry Standard Contract”. I refuse to work for forwarders who pay a pitttance, make unreasonable demands and treat me like a bonded servant. I cannot, in the deepest figments of my imagination, beleive that any professional organization, burdened with the cost of compliance, maintaining equipment and keeping good employees would sink to the level of bowing down and kissing the feet of the “Lords” making these unreasonable and unfair contractual demands. The members of Eagle Group XX desire, no DEMAND, fair treatment, fair compensation and respect for putting their lives on the line with each assignment they work. “DESCENDIT CUM TYRANNOS”
The “free” delivery to auction is a price decrease of $43.30. The elimination of storage charges, PP fees, “free” standard keys, the “fast cash” ARE price decreases that average approximately $52 per unit (averaged across all units). This is a $95 contractual price decrease.
With fuel expenses up and CFPB compliance requirements and costs increasing, the Primeritus price decrease will result in very low recovery performance and a significant increase in CFPB compliance risk exposure. Reputable, responsible, CFPB compliant repo vendors simply can’t send good agents and trucks for $200/repo.
Agents, give them the service their paying for, generate fake updates… and then if you happen to get an LPR hit on a Primeritus unit then decide if you want to pick it up for $200.
The cost of compliance with the CFPB will be heavy for repossession agencies. In speaking with some of my major clients, they have stated that they fully expect at least 40% of repossession agencies that work with any lender larger than buy-here-pay here lots to go out of business this year. Thats right, they are expecting vendors to be reduced by almost half!
Compliance demands that all company process are documented, a venue is provided the debtor to file complaints, those complaints are maintained in a database and responded to quickly based on the documented company policy.
In my companies case, and I am generally frugal, the cost for audits, the hours our employees spend on compliance, and infrastructure improvements have cost nearly $10,000 and we are only 3 months into 2013. The CFPB and compliance is a complete industry game changer for repossession.
As agency owners, we should be thinking about compliance in the same way we think about fuel costs. Running each account costs our companies time, effort and resources. In this new environment we have an additional cost to factor in; compliance. How much does compliance cost us on each account? Its hard to say right now. In my case it is significant, and if we would like to remain in business, and continue to be a stable, quality vendor for our clients we must raise our rates.
As for Relentless and I, we will not be part of the 40%, but will make smart decisions. An element of making smart decisions is to open up the lines of communications with the lending community and help them understand the repossession agency’s true costs of doing business. In this case, if they will listen I would welcome the chance to discuss this with Primeritus.
In looking for vendors on the cheap… The age old adage comes to mind, you get what you pay for. If you go cheap, often you end up paying more.
John, they will reap what they sow.
I just read a press release where Primeritus sold their captive repossession companies in Florida and California. At their pricing any regulated state would be impossible to make a profit in, I don’t care how many cars you pick up. They know exactly what it costs to recover a car and remember, they get the whole enchilada for the deal, not just the beans. If you depend on these types of companies to survive I feel sorry for you. What true professional works for free.
If you are stupid enough to agree to this BS you get what you deserve.
This is why we are on the ropes . . .we say NO.
We don’t work with any of these clients – we don’t cater to their B.S. of telling US what WE can charge for repossessions, storage, close fees and delivery fees.
We get calls to work with these companies alot and as much as we would love the workload, we say – No thank you.
Our workload has dropped over 50+%, however we enjoy working for the local credit unions and maintaining a personal relationship with our clients. We both know just what to expect and how things go with repossessions. Plus, these clients seem to be on the ball more-so than these forwarding companies. We get good information and if there is a thin file, then we both work together to find more information. This is how is was in the older days, and this is how we enjoy and want to work. It sucks to see how the industry is just a shell of itself now.
The compliance issues are now a scary reality and we will not be bullied into being held hostage by them. We are in compliance, however we don’t offer anything unless it is requested. I have had only one local client as to see our facility, full compliance packet etc. It’s there for the asking, however very few have asked. Blessing? Yes and No. However, since we ARE in full compliance via the set forth guidelines I don’t worry.
Will we survive? Hard to say, however after almost 50 years in the business – at least we can say we quit with a clear mind. Hopefully, not anytime soon however.
Chase, Primeritus and all these other large forwarders can just forget about calling us. We won’t sign their contracts or anyone else who makes us pay them to recover the collateral.
California is too expensive and ridiculous for us to work for free and I still cannot understand anyone who works this way. I don’t see how someone who runs 100+ accounts with no closing, no delivery, free 20 days storage and other free services can even make it. Not to mention repo fees below $350.00. Hell, it costs us $300 to run a repo with 100% compliance!
We are sticking to our guns, it has cost us – new agencies in the area are running all over our coverage area now. So be it. Wonder if they will be in business in a year?
When are these agencies going to get it? Stop the insanity – say NO and keep to your guns. Who needs to run 100-200 accounts you won’t get paid for? Once you recover those, what are you getting once the unit is delivered to auction? $285 – $325 total? Does that cover your costs for that repossession and give back anything else? Doubtful, and you are just spinning your wheels in a ditch.
Ugh, makes me dizzy.
Have a safe and sane St. Patricks Day and be safe out there!
-A
We did say no
They want us to work for fees that are less than we were getting 20 years ago! If there is no profit then there is no business.
Forwarding companies like this seem to think we operate in some fairy tale land: where fuel is free and our time is free, and the agency can afford to run all their accounts every other day with genuine updates, making contact with neighbors and friends of relatives, and landlords cousins who might have some obscure clue where we will find the vehicle. The one thing that is obvious to me is that the lenders don’t really read or comprehend the updates they receive through forwarding companies. Lenders simply forward accounts to Remarketing Solutions / Primeritus in the hopes that they can take over the entire recovery process. That is what they pay for, and what the get is agents who must report updates every 72 hours, whether they ran the address or not.
What we all know is in reality the model works best when the repossessor works directly with the client to find the vehicle. But too many clients are looking for an all-in-one solution. I wonder how many of us take these forwarders on , doing the bare minimum amount of work on the case, if the car is at the given address and we secure it great! But as for working to actually locate the vehicle, I think many times the work stops after the initial address is ruled out. I don’t know if that’s the case, but that is what I suspect. After all if you’re not going to be rewarded for the work, why bother?
There’s absolutely no way that my company would agree to a contract even remotely like this. Those that do are doing a disservice not only to themselves but to the industry as a whole…
These idiots purchase DRN( road hits) and want the vehicle recovered within 24 hrs with no close.(The 2 we recovered were hit on our cameras and recovered at a different location.) And they still want the vehicle transported to the nearest auction within 30 miles.
Not only have we told them no….
But F#@%k no!!!!!
Happy hunting …Eric C
Be safe and just say no!
Those that agree to the terms of such a contract might just be making money some other way……..which could lead to complaints to the CFPB and involvement with the judicial system. I am sure Primeritus’ clients are assessing their risk/benefit ratio after reading this article and the subsequent comments.
It is time for all to band together and just say no. The forwarding companies are ruining this recovery business. If they do not have us they have no business. They continue to demand more and pay less. Fre storage no redeem fees etc. Do they work for free?? then we should not either. Anyone who signs this contract should be ashamed. This is what will out all of us out of business. Our clients love us for the hardworking personal service we provide. Forwarding companies are just that, they get an email or fax of case and just resend to agent. Lets get refuse to work for forwarding companies and pout them out of business
Low income, high maintenance… Just called and said no, not interested.!!
This is a BS contract and no one will make decent money for what we do if you work for these Idiots, This company can go to Hell, I will NOT work for them,
Did everyone see the generous offer Santander put on the table, a $15 increase!! Be still my heart!! Is that before or after the rate decrease and the extra demands Primeritus put on the agents? This would actually be funny if it wasn’t such an insult. The rates they are offering are less than we were getting 20 years ago, yes 20 YEARS AGO, when trucks were $35,000, when fuel was under $2.00 a gallon, before we all had to deal with compliance, before we had to invest in monthly fees for everyone’s software of choice, before we all invested in LPR cameras, and the never ending expense of operating them, car, fuel, driver, insurance, maintenance, etc.
Lol u repo guys are funny u feed off the hard times of others there’s a place in hell for every last one of u the nerve for u clowns to complain
I refused to sign the new contract. No one even mentioned the part that if we get sued, we have to pay our legal fees as well as Primeritus’ legal fees. This new contract is full of all kinds of problems. I hope that everyone bands together and decides that enough is enough. We should be paid what we are worth. We know they bill a full repo fee, then want to keep some for themselves and pay us very little. And, what gives them the right to tell us what to buill for storage? I have payments on my storage lot, and what they propose, I could not even pay the taxes. This company, and all forwarding companies are ruining the repo industry.