In A Slowing Economy, The Big Toys Are The First To Go

What gets me is that people take a crap in the boat or vandalize it before it gets repo'd? Unreal.

RMX

----

The big toys are the first things to go
As overextended boaters hit rough times, the repo man hits the marina

By TAMARA LUSH THE ASSOCIATED PRESS

Published: Wednesday, July 16, 2008 at 4:30 a.m.
Last Modified: Wednesday, July 16, 2008 at 12:30 a.m.
FORT LAUDERDALE - In a bad economy, fun is often the first casualty.

ASSOCIATED PRESS / ALAN DIAZ

For James Hedrick, that means it is a busy time in his line of work. He is one of those dreaded repo men.

He spends his days scanning megayachts, sailboats and fishing skiffs as he steers his dinghy through a marina west of the city's skyscrapers, looking for a piece of the American dream.

This particular piece is a gleaming white, 65-foot Hatteras with two master bedrooms, two full bathrooms and a full galley kitchen with glossy teak cabinets. The owner is $35,000 past due on his $1.5 million boat loan.

Hedrick is an agent with National Liquidators, considered by industry experts to be the world's largest marine repo company. The Fort Lauderdale-based company has tripled its business in the past three years, and now takes possession of about 200 boats a month in Florida, Ohio and California. The company's competitors also say they have seen similar increases in business.

"They're going to hang on to the car; they're going to hang on to the house," said Hedrick. "But they're going to give up on the boat."

His employer has doubled its staff in two years to 85 repo agents to meet demand from the banks and lenders.

It is not just boats: Repo agents say banks and lenders have been asking them to reclaim all-terrain vehicles, motorcycles, small planes, snowmobiles, semi-trucks and, of course, cars. Vehicle repossessions were up 10 percent in 2007 over the previous year, said Tom Webb, an analyst for Atlanta-based Manheim, the largest car auction company in the nation.

One boat dealer, whose company also does recovery for banks and lenders, says those facing boat repossession were typically involved in the housing boom either as a real estate agent, construction worker or mortgage broker.

"A lot of this is self-inflicted," said Ray Jones, the owner of Long Beach Yacht Sales in California. "It's somebody who three years ago made $50,000 to $60,000 and didn't save a penny. They thought the income would never end. But the income stopped and the toys went away."

Rising gas prices have also made it harder for owners to make room in their budgets for boat trips. Marine diesel fuel costs more than $5 a gallon in some places, which means a five-hour jaunt on the water can easily cost $250 for some yachts. Last year's marine diesel cost about $3.40 a gallon.

"For about a year now, it's been good for the repo guy," said Don Mashak, the owner of First National Repossession in Minneapolis.

Overall, the marine industry is hurting. Bankers say new boat loans are declining. MarineMax, the nation's largest boat retailer, based in Clearwater, reported in April that sales fell 28 percent for its second quarter.

Because prices for used boats are falling, buyers can get repossessed boats under 60 feet for as little as 40 percent of what the boat would cost new, said Robert Toney, National Liquidators' president. Boats larger than that are less likely to be repossessed because their wealthy owners are in a better position to weather a slowing economy, Toney said.

Sometimes, owners turn the boats in to the repo agencies when they realize they can no longer pay. But other times, they hide or vandalize the boats before they can be seized, said Megan McQuaide, the owner of Repo Yacht Sales in San Diego. She has boarded boats with oil splashed around the cabin, engines intentionally overheated and feces on the deck.

"Sometimes it's really malicious stuff," she said.

On a recent June afternoon, Hedrick finds no such surprises aboard the 65-foot Hatteras. He and his assistant board the yacht to take photos and catalog any personal items. There are not many aboard, and the boat is unusually clean, save for a six-pack of Diet Coke and a children's video in one of the VCRs.

Occasionally, he finds the remnants of parties: bikinis, champagne bottles and even drugs. He calls police if he comes across anything illegal.

 

I'm sure these some psychological, psychobabble term for all of this behavior, stemming back to when little Ashley didn't get a pony for her 5th birthday and Dylan didn't get a Super NES for the C+ he got in PE class.

Typical white trash. There was a lot more white trash out there with money than there ever was thanks to the real estate boom. Luckily these folks are back working at Costco, or soon will be. Think about it, these are the same types of people who would probably spit in your food before serving it to you at Taco Bell.

RMX

 

Oh man where's that anime puke gif?

RMX