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January 13, 2009

Bank sets up repo lot

By The Mainebiz News Staff

A Lewiston bank's unorthodox approach to selling its repossessed vehicles has caught the attention of area financial institutions.

Northeast Bank has set up a side business called Maine Bank Repossessions that operates a nearby vehicle sales lot, run by the former co-owner of a local used car business, the Sun Journal reported. The venture clears the bank's inventory, which has grown with the bleak economy, and earns it more money on repossessions than sending the vehicles to auction. Northeast saw an uptick in repossessions in the fall, mostly of boats, RVs and other seasonal vehicles people decided to let go of before the winter, the paper reported.

Since setting up shop a month ago, the bank, which offers financing on the vehicles, has made three sales, with a fourth deal scheduled to close this week. Northeast still sends its cars to auction, but most of the seasonal vehicles wind up on the lot.

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