How the Repo Guy Nearly Took My Car

Repo ManWhen people ask, “What do you really know about the average guy? You manage money for rich people?” I always smile.  I’ve had the privilege of working through my share of wonderfully challenging personal financial situations.  And when I say “challenging” I mean the worst timing and situation imaginable.

Here’s one you’ll love and can learn from:

I’ve been a member of an entrepreneurial coaching group for a long time. Early in my career I was getting ready to head out of town.  My job was to pick up two additional participants and get the heck on the road since we were getting some pretty crappy winter weather.  As I was just finishing loading my bags in the car, my phone rang:

“Hello, is this TheOtherGuy?” (clearly someone who doesn’t know me. They even pronounced TheOtherGuy incorrectly!)

I answered with the affirmative.

“Hi, this is Rick with American Recovery…”

“Hey, Rick, whatcha trying to recover?” I said, half jokingly…and kinda wondering who this guy was.

“Uh, let’s see here…an Acura.  We need to get that picked up today.”

What?  That was my car!

AT this point I’m sure what’s happening: My wife listens to a radio program in the morning where they call people and get them all riled up and then surprise them with the fact that it’s all a big joke.  I’ve listened a couple of times and have told my wife that there was NO WAY I would ever fall for that stuff.

Ever.

So, immediately, I thought it was a joke.  So I sort-of played along.

Then Rick says, “So, ’cause you filed bankruptcy, Acura wants the car back.”

Now it’s getting serious…I’m pretty sure I would remember filing bankruptcy.  I assured Rick I had not ever (and would not ever) file for bankruptcy, and that he must have the wrong number.

Then he said the magic words…

“Who’s Sally?”

Mutha f*$#er.

Sally is my mom.

And here’s why that matters.  Several years earlier, when I’d bought my nicely used car (doing the right thing…Dave Ramsey would be proud), I decided that I was smarter than the people who figure out interest rates.  I was a young, aggressive financial planner and knew a thing or two about leverage.  So, I figured out that if my MOM co-signed the loan, it would save me another 0.5% per year in interest, thus making it worthwhile for me to take the financing (instead of paying cash for the used car) and invest the difference in some investment that would beat the interest rate.

In fact, I distinctly remember thinking how smart I was.

As Julia Roberts said in Pretty Woman, ”Big mistake.  Huge.”

I figured that I could clear this whole thing up by calling Acura.  You see, it was true. I’d just found out that my mom HAD filed (long story there, but a good reason) and not me!

Without boring everyone with all the details – I have never been treated worse in my whole life.  The people on the phone at Acura actually said “Well, if you weren’t such a deadbeat and wouldn’t have filed bankruptcy, this wouldn’t be going on.”

It really didn’t matter that I HADN’T filed for anything. They kept repeating what a loser I was.

White. Hot. Burning. Rage.

Finally, I ask for solutions – they offer two:

  • Pay off the balance of $10,680
  • Have car repo’d

Obviously, I’m choosing option 1, so I inquire: Can I just wire you the money?

Their answer: “No.  It must be Western Union.”

For those of you who don’t know, I found out that day that sending money via Western Union is a giant pain in the ass.  Trust me.

Oh, and did I mention the joys of going to the bank to take a withdrawal of $10,700?  The IRS likes those forms they make you fill out…they’re called Currency Transaction Reports.  And, I happen to know that 100% of CTR’s are reviewed by an IRS Criminal Agent.  Lovely.

All because I was too smart to just pay cash.

So, I went on my trip – worried the whole time that the repo dude was going to take my car while I was 800 miles from home. When I returned, I had to drive 4 hours round trip (since we bank online) to get $10,700 withdrawn from my bank account, then I filed out a CTR which basically invites the IRS over for dinner, I enjoyed standing in line at Walmart for 45 minutes…with TEN THOUSAND DOLLARS IN MY POCKET to fill out this long-ass form to Western Union a payment to Acura.

All because I didn’t pay cash.

…and because I thought I was smarter and could make a couple extra bucks on my own.  I guarantee that the time, energy and stress associated with this incident taught me a lesson – it’s not worth the time.

So, yes, I manage money for rich people…and average people. But many of the lessons I’ve learned are because I’ve also been there myself.

The lesson for today? Pay cash for your car and be done with it.

That’s my lesson: What’s a costly lesson you’ve learned?

Photo: David Berkowitz

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Author: TheOtherGuy

Full-time financial advisor, part-time blogger, part-time podcaster. Hangs out in Joe's basement a lot. 2 Kids. Despises snow.

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11 Comments

  1. That was so scared, I’m glad that you paid it right away There was an instance that we get an installment motorcycle and I forgot to pay it before the due time. I was so shocked because one of their staff came into our house and told me that he would get my motorcycle! So I hurriedly went to their office to pay, also in advance.
    Clarisse @ Savvy Scot recently posted..New year financial boot camp: save on transportation costsMy Profile

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    • Wow! That’s horrible. I couldn’t imagine having the repo guy in my house…..

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  2. Oh man that’s rough!!! How could anyone ever see that coming? I still think what you did was find in hindsight, just a stroke of bad luck. I’d certainly never buy or lease from the company that made you feel bad about yourself though. Geez, even after you explained the situation. Maybe they just deal with real life deadbeats all the time, but still…

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    • Yeah, I can’t imagine having a job where every person who calls in has “a story” behind why they can’t pay. That would wear on me (and my liver).

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  3. Great story and excellent point.

    Yeah grandma was right if you can’t pay cash for it you can’t afford it.

    It’s like that old saying goes, “if you don’t have time to do it right what makes you think you have time to do it twice”

    It’s funny that people finance things because they CAN’T afford to pay cash. Talk about illogical.

    This in fact makes the item being financed in this case a car MORE expensive because if you can’t afford to pay cash how are you ever going to be able to pay interest?
    Darnell Jackson recently posted..What I learned from Rob Cubbon the founder RobCubbon.comMy Profile

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  4. Interesting story. I financed my project vehicle even though I had more than enough cash to pay for it. Why? Leverage. I wanted to cash to make some investments and I got an interest rate so low that is was laughable. It has proven to work very well for me. I made my money in a few short months and now I am paying off the loan. It doesn’t always work.
    Grayson @ Debt Roundup recently posted..Barclaycard Arrival World MasterCard Review – 40,000 Bonus Miles OfferMy Profile

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    • I love your last sentence, “It doesn’t always work,” Grayson.

      The zero percent thing is often hard to pass up. It’s free money, and if you have the cash sitting elsewhere, it’s easy to see why people would try to beat the interest rate and take on the loan.

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    • How true. Now family plus food….that can be a fantastic combo….

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