Slashdot Mirror
High-Tech RepoMan
PlayfullyClever writes "A new gizmo is upping the odds that even the most hard-knock customer will come up with the car payment. Hooked into the ignition system, the gadget comes in a handful of versions with one common conclusion:
No pay, no start.
It's worked wonders at Norfolk's Patriot Auto Sales, where nearly every car that drives off the lot is outfitted with a PayTeck Smart Box, a system that hands over a five-digit code in exchange for each payment. Come due date, the car won't crank until the customer punches the code into a palm-size keypad wired into the dash.
I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money."
"I would think this "Smart Box" would get hacked way too easily, leaving car companies without their money."
From TFA:
"Buyers sign forms acknowledging the Smart Box, agreeing not to tamper with it and promising to return to the dealership for a free removal after the last payment is made."
That implies that screwing with it in any way will get you into trouble if you get caught. That's not to say that somebody won't try, but it also implies that they have a means of catching you.
This is my opinion. To make sure you don't steal it, it's covered by the DMCA.
Well, at least people with bad credit histories will be given the chance of buying to buy a car. It won't matter for those who have the money, but it just might be good for those who are poor.
If you read the article you would find out that the only people who would accept this are people who can't get anyone to loan them money for a car that works.
My brother runs a car lot in Memphis and has been using a device like this for years.
Sure a saavy mechanic can find the ignition lock out and disable it, but its in the contract that people sign at purchase that they will not disturb it, and is a felony to tamper with it (at least in Tennessee).
He's had a few folks defeat it and stop making payments, but eventually something happens to get the car repo'd and the customer in hot water. He says he's lost a very tiny percentage of the hundreds of cars he's outfitted with the ignition lock out.
--
We don't NEED no stinkin' sig
Repo men, whatever you think about their profession, risk their lives daily in order to prevent auto theft, which in a way is what failing to pay car payments is.
It isn't even like loan companies send out the repo man after your first failure to pay. You typically get several months of haggling and pleading before the loan company has no other alternative but to send someone out to repossess the automobile. And the repo man is frequently in danger from people who don't have enough money to pay the loan companies but usually enough to buy bullets.
Using a technical measure to disable cars, making them useless to the owner, is a great idea. It works with drunk drivers and car thieves. Just kill the engine and the car isn't going anywhere. The loan company can then repossess the car at their leisure, along with adding extra pressure on the defaulting "owner" to pay.
The real bottom line is not to over-extend your finances. Try to buy large items like cars with cash. The worst monetary investment you can make is to take out a loan to pay for a car you can't afford.
Jesus saved me from my past. He can save you as well.
Well, at least people with bad credit histories will be given the chance of buying to buy a car. It won't matter for those who have the money, but it just might be good for those who are poor.
Actually, it's still extortion plain and simple. There is a local "buy here, pay here" car dealer that has been using these devices for quite awhile. You would think that in exchange for getting put a device on a car that you own that they would give the people with shitty credit history a break on the interest payments. After all, isn't the theory behind charging people with lousy credit higher interest that you need to do so in order to recoup losses? Not as much room for losses with this system.
Of course it doesn't work out that way in practice. They still charge anywhere from 15%-25% on a car loan. It's legalized loan sharking that takes advantage of the most desperate among us.
I'd also point out that even if you need a loan to buy a car you still own that car outright. The only thing that the bank/financing company has in the car is a security interest. This is not the same as them owning a percentage of the car. So why the hell should they be allowed to require this?
I would encourage everybody out there to avoid the whole problem by not buying a car that you need a loan on. I have never spent more then $2,000 on a car. Sure, I spend some money in repairs -- but the year end figure doesn't come close to most car loans (which still need repairs). And driving cheap ghetto cars allows me to avoid having to pay for expensive collision coverage.
Failing that, if you must have a nice car and can't afford to buy it outright, then get the loan for your car from your credit union or local community bank. Why the hell should we be doing the auto financing companies any favors?
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
Before we get too far into the comments going on and on about how we wouldn't accept these in our cars and yadda yadda, we have to stop and remember one thing.
For the majority of people, you wouldn't need a system like this. Why? Because the majority of people, especially here, have reputable credit and can get a car loan, or have cash on hand to put a significant amount down.
I have a good friend who works in auto sales, and things in the used car business have become so bad, in terms of financing, that they were getting customers on the lot, essentially 'sold' them the car, and then couldn't get any banks to finance them. So what were they left doing? Financing the sale themselves.
Basically, you agree to pay the car dealership directly, instead of a bank. This puts a lot of pressure on the dealership, because instead of getting, say $12,000 upfront, in one payment from a bank, they are now getting monthly payments of $250 for the next 5 years or so. In doing this, they are really hanging their rear out, because if that customer makes two payments, and disapears off the face of the earth, that dealership has no way of tracking them, or their car, down.
That's why these systems are catching on so quickly, not as another form of 'big brother', but as an alternative for someone out there who needs a car, and can make payments, but can't get financed through a bank. This way, a dealership can move cars off their lot, and still protect their investment.
If you don't want a system like this in your car, the solution is simple, keep good credit. If you do that, then you'll be able to get bank financing, not get ripped off by a car dealership, and don't have to worry about 'big brother' in the passanger seat.
No man is an island, But if you take a bunch of dead guys and tie them together, they make a pretty good raft.
How about banner ads running across my dashboard to reduce my payment?
You don't own it, the lot owns it, you're making payments and they are allowing you to drive the car. Once you pay off the loan its yours to do with as you wish, but if you fall behind on the payments, its their right to seize their property.
09f911029d74e35bd84156c5635688c0
You don't own it, the lot owns it, you're making payments and they are allowing you to drive the car. Once you pay off the loan its yours to do with as you wish, but if you fall behind on the payments, its their right to seize their property.
I'm sorry, but in virtually every sane auto contract that is not so.
If I buy a car from a dealership then I am going to get a bill of sale. I will eventually get a title from DMV that shows that I own that car. The title will also reflect the security interest of whomever gave the loan for that car (assuming I didn't buy it outright) -- but the fact remains that I own the car.
A security interest is not the same as them owning the car. The lot got paid for the car by whomever I got the loan from. It's the same theory behind a secured credit card (another typical ploy used to screw people -- WTF does a secured credit card with no risk to the issuer require massive fees and 20% interest??). The bank doesn't own the funds you deposited into the account to get the card -- they only have a security interest in them.
Now I can't speak for the contracts that you sign if you buy a car from a carshark "buy here, pay here" type guy. I'm not stupid or desperate enough to do business with one.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
I was in the navy and yes I was stationed in Norfolk, VA. Most of these used car dealerships in Norfolk area are some of the most sleazy joints I have ever encountered. I have seen some of them sell poor newbie sailors crap like a 500 dollar beat up pinto for tens of thousands of dollars. Hell I used to be a mechanic in the area and some of the patch jobs I did on engines and stuff for some of these sleazy dealerships was simply scary. They used to bring me stuff that had rings so shot that the cars looked like a mosquito fogger going down the road. I would swap out the oil with some good ole synthetic (does not smoke when burning) and shoot it down the road. The dealership would sell it to some fool with a 30 day warranty on the engine and laugh their way to the bank.
The state could step up and do something about it by applying reasonable intrest rate caps like a bunch of states do.
Got Code?
You can point till the cows come home. Legally your still wrong.
Umm, bullshit. Do you not know what a Lien is? To quote: "In U.S. law, lien is the broadest term for any sort of charge or encumbrance against an item of property that secures the payment of a debt or performance of some other obligation."
A lien tells somebody who might be looking to buy your property that somebody else has a security interest in it. This does not mean that you don't own the property. It will probably prevent you from transferring ownership of that property until that lien is satisfied but it does not change the fact that you own that property yourself.
In fact, even if the property is transferred the lien will usually survive and the new owner has to deal with it. A good example would be a house that was seized by the government for taxes that still had a mortgage against it. If you buy that house at government auction you are going to have to come to terms with the bank that holds the lien against it.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
A few years ago I developed a GPS-based system for tracking vehicles. Long story, but the client's original business plan didn't work--but his sales manager cottoned on to the idea of installing the units in cars at buy-here, pay-here car lots.
I bitched and moaned, and eventually dropped the client--in part because of the liability exposure, and in part because of the general sleaze. But I learned a bunch along the way.
How buy-here, pay-here car lots can do this:
It's simple: when you "purchase" a car from a buy-here, pay-here car lot, you're not buying the car. What you're doing is technically signing a "lease-purchase" contract: you're leasing the car until the final payment is made. That means the car dealer doesn't have a secured interest in the car--he OWNS the car. If you miss a payment, he picks up the car--and you have nothing.
That's dramatically different from a typical car purchase. If you buy a car from a new car dealer--or a reputable used-car lot--you will almost always finance the car. If you finance the car at the dealer (generally not a good idea) you'll sign something that looks like a loan agreement, but is technically called a Retail Installment Sales Contract (RISC). It is a contract to pay for the car over a certain period of time. The dealer then sells that contract to a bank or finance company. Key point: you are buying the car, and signing a contract to pay a loan--securing the loan with the car's title. Suppose you buy a $25,000 car, and put down $5,000 in cash and trade-in on your old car. Suppose you lose your job two weeks later, and can't pay the loan. You tell the bank--they'll be perfectly willing to take the car, liquidate the loan (by selling the car at auction), and give you the difference between what they sell the car for, and the balance on your loan.
With a lease-purchase agreement, it doesn't work that way. The car belongs to the dealer, not to you. If the dealer suckers you into putting money down, you have only the contract language (if any) to guarantee that you'll get anything back if the car is repossessed.
Buy-here, pay-here is a very bad deal
Bottom line: if your credit is so bad that you have to agree to install any kind of automated device to track you or force you to pay, you shouldn't be buying a car. First, you clearly are going to have trouble affording the car. Second, the cars the buy-here, pay-here crooks sell are typically heaps of junk: the cars left over at the auction that nobody wants to buy. A 1992 Ford with 150,000 miles on it isn't just going to require a monthly (or weekly) payment to the dealer--it's going to require a steady stream of parts and repair bills to keep rolling. Your chances of keeping that heap rolling for the two or three years of the "loan" are slim: and if the heap dies, you're still stuck paying credit card interest rates, and you don't have wheels.
A bit off-topic, but anyway; in the Chicago area I see people filling their car up with the engine running all the time during the winter months. I've done it myself occasionally, and it's not at all uncommon to see a whole station filled with running cars filling their tanks when it's below zero.
everyday is another shooter.
That lien is callable the momment you default on the terms of the contract, its not a matter of them sending a real repo man out then it becomes callable. This device secures their interest in the property, well within their rights.
09f911029d74e35bd84156c5635688c0
I own and operate a used car lot. The devices we use are by a company called Passtime. The type of operation we have is a buy-here-pay-here lot that attracts a lot customers with sub-prime credit, and we haven't had a single customer not buy a car because of the device. The fact is, if they won't agree to having the device on their car, they probably won't pay (keep in mind, these are sub-prime customers). We usually weed them about before they even come inside!
The device is quite easy to "hack" if you would even call it that. Its just soldered to the wiring harness and can VERY easily be bypassed. Most customers don't question it because "its a little computer thingy" and its "very complex".
Apart from all that, in the contract, the customer must sign about three pages of forms made up of about 15 signatures from both buyer and co-buyer agreeing to all the terms and conditions regarding the device. Again, our customers never have a problem signing their John Hancock on the line.
About the operation of the device: Currently, the device we use utilizes a "code" system where the customer pays their payment, we give them a 9-digit code from Passtime's website. The code is only good for however many days we set it, then we can set warning days where it will beep upon starting to remind them that their payment is due, and each code has atleast two emergency days that they can use by pressing 999-999-999.
Regardless, it'd be nice if Passtime would give me the freakin' code to generate the Passtime codes so I can integrate it into my software! They protect it quite well, thankfully!
Those liens are callable if you default, and since most car/land loans are secured with the property in question, it's the bank/dealer's right to seize their property if you are in default.
You are entirely correct -- but for the use of the word "their". It should have been "your".
It's also a little known fact that in virtually every state if they seize the property they have to make every attempt to sell it for maximum market value. Anything gained above the amount of money they are owed has to be turned over to the owner of the property. Of course with a car loan you are screwed because cars never gain value -- but if they seize your house and the market will pay twice what is owed on it then they have to send that excess cash to you.
Of course nobody knows this and being the nice industry that it is most people get screwed over anyway by the credit sharks.
You know, it's very easy to slam someone for not being able to pay their bills. But why don't you take a look at the credit industry sometime before sticking up for them. A lot of them are bloodsucking motherfuckers that pray on people.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
Only on Slashdot could I find out about an article like this, about a device that only affects people who do NOT make their contracted car payment, and then find comment after comment after comment talking about how horrible this is. I guess its just terrible the way those bad old car lots expect people to actually follow their agreement and *pay* for their car.
I want a new quote. One that won't spill. One that don't cost too much. Or come in a pill.
Long time lurker here... I think I am qualified as an expert, having come from a family of car salesmen. I have been actively involved in the new and used car business for over 20 years. I currently work as internet sales manager at a medium sized Big 3 dealership. Like all other dealerships, we regularly run "come one, come all" types of sales. While these sales bring out several people with strong credit, it also drags in the absolute dregs of society. We make our living selling cars. Most of these scumbags are simply societal misfits. They are not people with "no credit". There are people with abysmal credit. We see Transunion scores under 500 on a regular basis. These people could not finance a pack of chewing gum without a 700+ score co-buyer. So where does that leave them? Why at the "b" lot "buy here-pay here" operation. I have a personal friend that is involved in this business. He is a small businessman with limited resources. He does not carry a large inventory, but the cars he does have are decent. He does his best to make sure that the cars he sells are in good running order, as he knows that if the car isn't running, the customer is not going to be paying. He charges exhorbitant interest rates, but he is the one taking all the risk. If the customer skips town with the car, he has the expense of trying to reclaim it. Most of his customers are pretty faithful in paying, but that is only because he is very selective about who he sells to. Why people think that profit is some kind of crime in the car business is beyond me. Nobody faults the factory worker building the car for pushing for bigger money and benefits. There is no union for salespeople in the car biz. Most dealers offer pretty poor benefit packages. This device is being used successfully by several dealers. They have invested in technology to protect their financial interests. How is this different than a tech guy investing in quality software to protect their property?
You need to brush up on your secured credit law bucko. A car loan comes with a security interest in the car. The car belongs to the customer. In no way is failing to pay the loan back "theft," it is default on a loan or, at most, fraud if the person entered into the contract with scienter. It is no more theft than failing to pay one's credit card bill.
The holder of a security interest (the car lender, here) has the right to "self help" in the event of default to satisfy the debt. (He also has the right to proceeds if the owner sells the car to someone else.) This is a difference from "unsecured credit," the best example being a credit card. No matter how much money someone owes on a credit card, the repo man can't come to his house and take some stuff to settle the debt.
In other words, I would bet you five hundred dollars you could not find a single court case where someone was convicted of "theft" for failing to make his car payments. I'm glad you're a fan of the repo man, honorable work, blah blah blah, but like most slashdot posters you don't know much about the law.
With great power comes great fan noise.