MEDFORD, Ore. - With a big increase in auto repossessions, Rogue Federal Credit Union is auctioning off its returned or repossessed vehicles on the Internet. A surge in the number of people turning in their cars because they can no longer make the payments, coupled with overloaded dealerships that cannot get rid of inventory, made it impossible for the $402-million credit union to stick with its previous storage and auction plans.
"We've seen an increase in delinquencies like anybody else has," said marketing director Jeanne Pickens. "We used to put our repos on a local car lot, but the car lots of course are crowded as well."
Repossessions are up significantly at Rogue-by about 50% in the past year, according to Pickens. In July 2007, the credit union had 57 vehicles on hand. That number swelled to 89 this July.
The vehicles turned in to the credit union are being stored at its branch locations instead of the car lots, and are no longer shipped to Eugene or Sacramento for public auction. As many credit unions have done, turning to the web to sell the cars is a "no-brainer," because of the lower costs and higher exposure, Pickens contended.
"It allows us to recover a good portion of our costs along with returning a good running vehicle back to our members," she said, adding that members and non-members alike are eligible to buy the vehicles. "We've sold vehicles to non-members in New Mexico and Texas who somehow found our online auction site."
The story for Rogue is the same as it is for many parts of the country, Pickens noted, with members who are in the construction and real estate industry chief among those who are being forced to give their cars back to the credit union. While Rogue's delinquencies are up, so is the number of auto loans that the credit union is providing.
"Our loan volume is up, and the last few months were great for us," Pickens said. "We just did a loan promotion in the month of July and it was one of our best ones yet."
The nationwide trend is holding true in Oregon as well, with many members getting rid of their existing SUVs and trucks and picking up economy cars with good gas mileage. Rogue is even helping its members get rid of the cars they already own-even those who are not in financial trouble. Members can post their cars up on the credit union's auction site to try and sell their vehicle for any reason.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com/ http://www.sourcemedia.com/
