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Strategies & Market Trends : The Financial Collapse of 2001 Unwinding
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To: Broken_Clock who wrote (13731)9/19/2025 12:03:50 PM
From: robert b furman2 Recommendations

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Roads End
toccodolce

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Hi BC,

If Tricolor made loans to illegal immigrants, their employment may well have been fraudulently represented on the credit application.

In the case of a default, the credit papers will be analyzed. This will determine if fraud occurred. If it did the loan goes back to the used dealer. He then owns the outstanding ballance on his books.

My first thought is that if 1.5 million illegal immigrants have gone back home, they more than likely drove the car South over the border.

Repossessions by themselves are not hard to work out of - IF YOU HAVE THE COLLATERAL.

If you have the collateral, there are many auto auctions that will find a willing buyer in this "hard to find" used car market.

We are close to the year end, were we customarily warehoused well-kept high mileage vehicles (November and December) as they get a boost in value at the auctions, when tax returns start hitting the lower income earners.

Many a tax check has been the down payment, when the earned income tax credit refunds get mailed.

If Tricolor got the word out that loans to illegal immigrants could get financed, to the degree they are driving home in the collateral, there will be a lot of complete losses being realized.

High interest rate loans pay down the balance very slowly in the first initial payments - there could well be some big losses just being realized. Dealers who juiced the credit ap need to be worried when the Tricolor auditor walks in the front door.

When the auditor walks in and wants to view the credit package for stipulations, the next determination of liability will rest on the terms and conditions audit.

This will take time and be tedious, with some major losses rolling downhill to the used car dealers out there.

If the Hispanic clientele is the larger portion of their used car business, it could well take down some used car operations - not to mention subprime lenders.

The first thing to lock-up will be future special finance credit aps being looked at. My bet is it has come to a screetching halt already.

Been there done that.

Bob
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