For Canadian Repo Men, Business Has Never Been Better

Tyler Durden's picture

Four days ago, we again profiled Canada’s unraveling economy.

For those who may be late to the story, the inexorable decline in crude prices that’s played out over the past 13 or so months means the country’s oil boom is now its oil bust and nowhere is the sharp reversal in fortunes more apparent than Alberta, the heart oil Canada’s oil patch. 

Oil and gas investment in the province tumbled by nearly a third in 2015 as rig activity plunged by 50%. The country as a whole has lost 100,000 oil and gas sector jobs amid plunging prices and as Bloomberg noted last week, some skilled workers have given up on the sector, choosing instead to go back to school in order to acquire the skills they need to pursue employment in other fields. In a sign of the times, food bank use in Alberta was up more than 23% in March (the last month for which there's data). Here's a look at the interplay between crude prices and Calgary's unemployment rate:

Meanwhile, the rash of layoffs is having a profound effect on Canadians. Suicide rates in Alberta are up an estimated 31% this year as “people are just at wit’s end,” according to an operator at a distress hotline center. Crime is up sharply as well. Property crime in Calgary, for example, rose nearly 40% during the first quarter.

In yet another sign of a rapidly deteriorating situation, 1.7 million square feet of office space has become available in downtown Calgary, more than any downtown in North America.

But not everyone is Alberta is struggling. Take Steven Low, CEO of Consolidated Recovery Group for instance. Low's company works with courts on auto repos and evictions and as you can imagine given everything said above, business is booming. Here's The Calgary Herald:

While the crash in oil prices idles drilling rigs and empties out downtown Calgary offices, Steven Low's company can barely keep up with the deluge of work.

 

Low is CEO of Consolidated Recovery Group, an agency in Western Canada that works with lenders and the courts to recover bad debts — by repossessing a car or carrying out an eviction, for example.

 

It's been a busy year for the company and the work has only picked up as the crude doldrums linger, squeezing the finances of the many Albertans who rely on oil and gas to make a living — either directly, or through its economic spinoffs.

 

Low says bailiffs at his firm are working around the clock and he's even had to hire more staff to get all the work done.

But Low says he's not particularly enamored with the idea of profiting from the Alberta's collapsing economy. "We don't gloat or feel terribly excited about the economic conditions right now. We approach every single repo and seizure as an opportunity to help respect the dignity of the debtor," he says. 

And Low isn't the only one who's seeing his business double or triple in the face of the widespread malaise. There's also John Shortridge, whose Allied Shortridge Civil Enforcement is twice as busy now as it was just six months ago. "Shortridge is a veteran of the business — first with the Alberta Sheriff's Office and then on his own after civil enforcement functions were privatized in the province in 1996," The Herald notes. Here's Shortridge's dire warning: "This reminds me more of '82 and '83. It was bad and it was long... My view is this is going to be a long haul." 

On the bright side, if you're an Albertan and you find yourself "doing business" with Low, Consolidated Recovery Group will work with you so that you can save face. Here's Low: "...we will go out of our way to seize a vehicle around the corner or allow the person to bring it out of their place of work so that co-workers don't see their vehicle being towed away." That of course assumes you still have a job.

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Cognitive Dissonance's picture

The trickle down theory?

Mal investment run riot. When do they start repo-ing houses?

Atomizer's picture

If you own the house deed, that cannot happen. Most of this bullshit revolves around shifting debt into another brokering cesspool to resell the debt to redeem federal reserve projections. 

If you own a new car, GPS will find you for non payment. Horn goes off first. Then they pick it up. That's the sign and drive leasing hatch you see on Internet and TV advertising. 

Always purchase your car in cash, or by check. The finance manager will be pissed. Tell them the car is not a necessity, you still have time to shop around. Walk out of dealership. The phone will be flooded with calls. Just ignore. I did this with competing BMW dealerships within 30 mile radius. Sure, I saved a couple hundred bucks. The prior dealership wanted a lease program only. I don't lease cars. All part of the banking fuck up. Reselling debt. 

Lostinfortwalton's picture

If you own the house you still have to pay taxes and insurance  and city utilities, and electricity, and natural gas, and maintenance and upkeep. A lot of "folks" who own their houses in many parts of he northeast find thay cannot afford to remain in their paid for house when they retire. If they can unload the turkey they can move to places like the Alabama Gulf Coast and get a much nicer house at a much lower cost.

Cognitive Dissonance's picture

My son purchased a home last year in Pennsylvania where the local property and school tax amounts to 5% of the purchase price paid yearly. The amount of escrow collected for taxes and insurance monthly is equal to the interest and principal payment.

Anything you must pay a 5% 'vig' on in order to 'own' is simply another word for 'renting'.

CheapBastard's picture

"... Just because my house value goes up, that doesn't mean I have money to pay my taxes," he said. "When your house value is going up, but your taxes are six, seven, eight thousand a year - that's not a good investment. It's keeping me from upgrading houses here if I want to, just because of taxes."

 

http://www.chron.com/neighborhood/katy/news/article/Katy-residents-hurt-...

post turtle saver's picture

I hate the level of property taxes in Texas as much as the next guy, not to mention the 'Robin Hood' school funding, but I will note this... if your household income is between 150k-200k in Texas (_anywhere_ in Texas) and you bitch because you can't swing 6k a year in property taxes, you'll excuse me if I don't sympathize... that's some pretty shitty income management right there... come to Austin, I'll show you what out of control property taxes look like... it starts with AISD thinking they have a mandate to throw money around like it's confetti because the stupid voters here keep approving ridiculous bond issues, because hey that's just 'free money'... fucking idiots

sun tzu's picture

They're fucking you up the ass for the children. Don't you know that children can't learn unless they all have new iPads and Macbooks each year? The classrooms also need the latest 55 inch flatscreens. Then they need to pay $500K to have consultants because the $200K they pay to the principal and $150K to each assistant isn't enough to hire someone competent.

Lumberjack's picture

If you become a religious scamster, and use your home as an office or church, you may be exempt. 

Cognitive Dissonance's picture

"That's insane"

Agreed.....and I conveyed that sentiment to my son. But what is even more insane is that prior to 'owning' he was renting. And his 'rent' (for less square feet of living space) was 40% higher than the cost to 'own', even when the taxes and insurance were added in.

Go figure.

post turtle saver's picture

yep, damned if you do damned if you don't... when it's all said and done you just boil it down to a home is a place to live... it's not a bank, it's not an investment, it requires constant maintenance and general care and feeding and the tax man will always have his due...

hal10000's picture

Capitalism is designed to suck wealth upwards.  Always has, always will.  It's no different from any other social order in human history.

sun tzu's picture

Government raping you up the ass is capitalism?

WonderDawg's picture

You obviously don't know shit. Since when is the government sucking up your cash considered capitalism? Dumbfucks like you are the reason this country is going down faster than shit through a goose. Jesus tapdancing Christ, where do these idiots come from?

OldTrooper's picture

Buying is usually cheaper than renting, CD.  But it's easier to walk away from a rental if you need to relocate.  Owning can trap you in an area.  I've watched plenty of guys buy homes in oil and gas boom towns, only to be stuck there working 2 or 3 jobs when the inevitable bust rolls around, if they can find jobs at all.

sun tzu's picture

Buying may be cheaper if you have a family and need the space. You can't tell me buying a 4/3 or 3/2 house is cheaper than renting a 1 bedroom apartment, especially when you add in the property taxes, maintenance, and insurance. On top of that, you can always rent near your workplace and save thousands a year on fuel costs and sitting in traffic. for hours each day. For 5 1/2 years I had a 2+ hour round trip commute and it sucked the life out of me. 

stormsailor's picture

i own a nice home in a small town in rural south carolina.  the county taxes are about 5%.  i don't live there and it sucks sending off 4k every year to a town that doesn't even have curbs or gutters,  i grew up there and 50% go for the schools.  the schools are so bad i think the sign reads skool.  oh, and i'be been paying this for 10 years

Skateboarder's picture

All right - someone finally had the courage to spell it correct for once!

Normalcy Bias's picture

I'd wager that if one were to ask those local authorities, they'd say they weren't receiving enough tax revenue. MOAR, they'll always need MOAR.

Theosebes Goodfellow's picture

I'd wager that if one were to ask those local authorities, they'd say they were all democrats. And you're right, for them there will never be "enough".

As an aside, as a tax-and-spend politician or public school "administrator/educator", (any flavor), "How much tax is "enough" and watch the blank look fill their faces. The question had never even occur occured to them. Amusing at first, after a while it is really rather sad.

sun tzu's picture

They could take 100% of your income and leave you under a bridge eating out of a dumpster and it still wouldn't be enough for them. They wouldn't be satisfied until they could harvest your organs and sell them and sell the rest of your remains as fertilizer.

post turtle saver's picture

the kicker is when the locals start complaining about "youth flight"... like anyone with a brain would stick around for that fleecing when the jobs available can't afford that level of skim...

I keep seeing the word "unsustainable" used for a great many things, it certainly applies to property tax levels...

sun tzu's picture

All you have to do is say it's for the children and the dumbfucks will vote yes and never question how the money is being spent. It's the Oprah effect.

two hoots's picture

 

We are all renters.  Just stop paying the property tax and the landlord (gov) will boot you out… paid off or not.  The dream is the “little lie”.

 

Son of Loki's picture
The rise and fall of the American middle class

 

'Downward mobility' is all the Fad. As you say, with rising property taxes, insurance, utilities, maintenance, Obamacare tax, job losses, job pay freezes, etc., it's harder then ever to keep your house.

Montani Semper Liberi's picture

After 25 years of struggling to make the payments, I was finally able to pay off the mortgage in 2013. If I miss making my property tax payment, the county will send in the armed thugs that they call sheriffs, and I will be evicted from my "paid off" house, and my deed auctioned off on the courthouse steps.

 I often wonder how these men (and women) deal with turning people out of their homes and onto the streets. I imagine the sheriffs off-duty conversations at the local bar goes something like this:

 Sheriff #1: "You should have been there! The widow Johnson was crying uncontrollably and collapsed in a heap on the front porch. I thought I was going to have to pull my service revolver in order to motivate her, but her ten-year old and eight year old daughters manage to get her on her feet and to the curb where they were off our newly acquired property."

 Sheriff #2:" Oh man! I wish you had some video! Did you manage to lick some tears off the faces of that tax deadbeat c*nt and her kids? That would have been delicious!"

 Sheriff #1: "Better than that. I was able to help myself to a couple of pieces of exquisite antique gold jewelry. My old lady just loves them!"

 Sheriff #2: "Life is good!" (Clink!)

Theosebes Goodfellow's picture

It is possible to get off the tax rolls but you give up all of the "amenities" that being on it provides, like fire protetion, schools, water, sewer, or any other "service" represented by paying the "tax". It's called Sovereign something or other. BTW, you must pay off in gold, not FRNs.

Stoonod Nicknud's picture

There is a guy in detroit that gets ex-military members off of property tax, free-and-clear.

 

 

Hongcha's picture

 

Good article; but the New York Post is typical amoral, mocking East Coast filth ... I had to hit 'Block Element' several times for those few paragraphs...

 

Jack Burton's picture

I don't shop for a new car until my checking account contains the entire amount I need. Then I go in to the dealer and ask for his best and final offer to sell me the car I want. I take that and leave. I use that as my base and call 5 other dealers within 200 miles. I live semi rural. Then I call dealers and ask for their best and final for the same car. Usually the phone starts ringing off the hook from the local dealer I visited in person. Last time I told him that another offer came in 1,200 dollars under his best offer. He got mad, but called back in an hour and said come pick up your car. What pisses me off his his best and final was not his best and final. He even seemed a bit put out that I got 5 offers not counting his. I went with him because he is local and I like to deal local if I can.

But these guys are always liars. You ask for best and final, and they still tack on 1,200 to 2,000 over what the car is worth. They think everyone is a sucker until they prove otherwise!

Theosebes Goodfellow's picture

Consumer Reports had a methodology for finding out what any given new car actually cost a dealer. I don't recall what it was but it would save you having to jimmy-jack around with asshat dealership sale people. Personally I do not buy new cars, cosidering that a new car loses 27% of its initial value the moment you drive it off the lot, (on average).

A year-old or two year-old car is fine enough for my likes. I usually figure out what I want, call around to local credit unions and banks and find one in the model that I want that has been repo-ed. You get the same warranty as the original buyer and save buckets of money. Also available are former lease and rental cars, though I prefer pre-owned by private parties vehicles as they tend to be less trashed than the lease-rentals. But yes again, cash in hand. Cash is king.

barroter's picture

anyone selling you anything, is scum.

armageddon addahere's picture

Look at the first chart. Unemployment which was only 7% a year ago has roared all the way up to 7%. 5 years ago it was 9.5%.

 

These self proclaimed pundits never give up. After predicting a real estate crash that never happened for the last 8 years, based on prices in Toronto and Vancouver, now they think the whole country is going to collapse because the oil patch is in trouble again.

Theosebes Goodfellow's picture

Whose unemployment numbers? The government's? That shit is more cooked that a Thanksgiving turkey that is still on the oven. The real number as far as unemploment goes is that of those "not in the workplace", which last time I looked was something north of 94 million. In a nationwide population of something like 330 million, that works out to over 28%. 7%, my ass.

Badsamm's picture

I'll be ready for a cheap almost new car next year.

VinceFostersGhost's picture

 

 

He's not what you might call a glamor man......he's mister repo man.

two hoots's picture

How do they Repo student debt?  

tarsubil's picture

They find that very valuable piece of paper with the fancy writing on it and some schlup's name. Those pieces of paper go for a lot on the black market. /sarc!

divingengineer's picture

They ruin your life. If it's worth anything.

Theosebes Goodfellow's picture

~"How do they Repo student debt? "~

Full lobotomies?

JohnG's picture

The IRS will hound you until the end of time....

flyonmywall's picture

Coming soon, to a Texas and Nebraska near you.

 

Son of Loki's picture

It's already there. My friend's dad is a tow truck owner...in fact he has 12 tow trucks in the DFW area that operate 24/7 repo'ing vehicles. Pulling out of parking lots, driveways, etc....24/7.

He's one of the wealthiest men in his neighborhood too.

It's a very good business. Rough, but very lucrative.

Max Cynical's picture

I've never understood why finance companies don't keep a set of keys until the loan is paid in full. It seems it would be much easier and less expensive to repo a vehicle if you already had a set of keys.

seabiscuit's picture

Welcome to the universal metric key. The banksters already know how to get in your car and your tracking device (that also has a phone - and you pay for) makes it easy.

Theosebes Goodfellow's picture

~"I've never understood why finance companies don't keep a set of keys until the loan is paid in full."~

Better than that, these days. The used car dealers install a GPS kill switch on their units. If you fail to make a payment, (buy-here/pay-here), they disable your ride. Miss three and they come get it. This with an interest rate sometimes exceeding 9%, the used market is holding its own, (and most of yours!). They only guys killling it harder are the payday lenders. Them vampires can walk in the daylight.

Stoonod Nicknud's picture

Something like that happened here to the "Superstar" dealer years ago. They remote-killed a car in default, problem was, a lady with the same name as the woman behind on her payments, was driving her car to work when they did it. She died. Her payments were on tiem though.

mkkby's picture

If any cock sucker GPS stopped my car, I'd drain the oil and drive it until the engine fries.  Probably about 3 miles.  Come and repo that, asshole.