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Holy smokers folks this ain’t no dang jokers every once in a while i find a really good video from smaller youtuber who uh puts out something really good and i think this video is really good one i just got a chance to see here uh only has 11 000 views from a smaller youtuber named lucky lopez and he put out this video yesterday on the used car market bubble is
Popping and the video evidence he’s going to show you in this video is quite compelling and this this man knows a lot about the automotive industry and so i thought i would react to this bringing this to your guys attention i love bringing um you know people’s you know names to attention when they have something valuable to add to the community and i think this
Man has something very very valuable to add in a moment in time where we’re looking at a likely recession and um people are trying to figure out like what’s going on here what’s the truth these government numbers how truthful are they um you know some of these numbers lag and things like that like what’s going on in the real world well you know let’s find out
So the main reason why i made a video about this four months ago is when i was sitting down with one of my bankers i got very scary numbers from him he kept telling me that they had multiple loans uh defaulting first second third payment defaults which is really bad but majority of these loans were produced from 2020 and 2021 during the actual pandemic so a lot
Of these people were i call them stimulus ballers people that had you know four thousand dollars a month income they could traditionally not finance or get approved for these types of vehicles were getting approved they got back stimulus they weren’t paying their rent they weren’t paying their bills and so therefore they will be able to buy these cars more and
More and more now the reason why i want to make this follow-up video is because a lot has changed the repo rates have skyrocketed now during the pandemic there was a lot of rules and regulations that allowed banks to not basically foreclose on people when it comes to homes they also have the same thing when it came to repoint cars now we’re gonna go after just
Repos of cars when it comes to actual banks we’re not gonna talk about payday loans and all that other stuff but one of the things that a lot of these banks were forced to not go rebuild people’s cars i’m gonna show you a kelly blue book article right here all the particles will be linked in description below but it talks about how the government was telling a
Lot of these banks not to go and actually repo people’s cars give them time let it work it out so a lot of these people even though they bought these cars in 2020 and 2021 they weren’t making any other payments they were claiming oh you know covid i lost all my money the rona you know took me out blah blah blah and so a lot of these people were getting away with it
They were letting them keep their cars even though they’re behind and so fast forward today to 2022 and nobody’s safe all the regulations are out they’re refalling like crazy and that’s some of the stuff that’s starting to trickle over into the market now when i did this video i gave a breakdown all this other stuff i’ll leave a link in the description somewhere
Here for the other video but the one thing i want to show you guys is what’s going on currently they’re talking about uh repo rates skyrocketing to almost double what they were in 2018 and 2019 because that’s technically the last time we had correct data for this now they’re saying there was an estimated 1.8 million repos that were repo’d in this business year now
During the pandemic like i said we couldn’t take real numbers because it was kind of spread all over the place there’s a lot of repos there’s still over 2 million repos during the pandemic in those years but we don’t count them because we don’t know if those are the real numbers or not fast forward to 2022 and we are sitting as of right now 2.2 million repos i’ll
Let that settle in in 2018 and 2019 through that whole year it took us that long to get um a little over 1.8 million repos we’re sitting at 2.2 million and we’re only halfway through the year that just lets you know how far wow that that’s an extraordinary number by the way if you’re enjoying me sharing this video with you guys don’t forget to smash but that’s an
Extraordinary number and just wait till you see the video evidence here we’re going to get into in just a moment but that’s an extraordinary number because you you think about this on a deeper level and it’s like you know we haven’t even seen like unemployment go up in any major way we haven’t even seen real estate get hit in a major way yet and you got to think
Like look at all these repos of all these vehicles but a lot i’m sure a lot of people got loans that probably shouldn’t have gotten loans on a lot of these vehicles and uh you know they were in a situation where they were pumped with stimulus and all this money and and things like that and plus you know you didn’t have to pay your rent your mortgage and all these
Different things that were going on at that time right and obviously we know there was a lot of people that were lying on pp loans and all that crap that was going on right and now these folks are starting to get their vehicles evicted uh or i should say repo left and right right and um yeah this is how crazy this is so when i came out there and tell a lot of people
Especially these finance people that this is an indicator uh the automotive indicator that there’s a recession coming there’s bad things coming we’re about six months to a year ahead of the real estate market a lot of people judge oh if the real estate market pops that’s when you get told things are bad the car business once you see auto loan defaults it’s the
First thing that goes and that’s about six months to a year ahead of the real estate market because people will let go of their cars they’ll let go of their other things before they let go of their house so that’s why to me the main indicator when it comes to recession is the actual automotive market now what we’re gonna do is i’m gonna take you by my friend’s
Yard and we’re gonna go over what i’m seeing and just to kind of give you guys a heads up of what’s going on in the market so we’re here at our first location it looks like a prison but it’s actually a prison for cars this is a repo yard here in vegas there are multiple of these things scattered all over town now as repos start to come in it’s these companies
Job to go pick them up they put them behind the gate customers have 10 days to pick them up if they don’t pay make deals at the banks whatever then they get sent to auction or get purchased by people like myself and then from there they basically either get sold auctioned off whatever else now the reason why i’m bringing you here and i want to show you this is
Unfortunately um my friend he didn’t want anybody knowing where his place is at which i can’t blame him people try to show up and that’s why there’s barbed wire they try to break it and steal their cars but his lot it’s a little over two and a half acres is completely full 100 full now this is the first thing i want to show you guys and let you guys know on why
Repos are starting to pick up you know because like i said i can read you stats i can read your articles but you know starting to show you some of the stuff like this and not only is he so booked up where he has this they’re actually planning on purchasing uh some property which i’m going to show you right now so we’re here at the new location the reason why i’m
Showing you this one this one’s about an eight to ten uh hey hey okay see in life there’s always good things and bad things that come out of things right and so the bad news is cars are being repossessed right left and right and it’s probably going to get much worse over the next 6 12 months however if you want to think about something that’s good news this guy
You know his friend here is going to buy more land and you know i’m sure he’s going to have some construction so you know we got to put the car somewhere so hey and life is always good and bad that comes with everything right you can see actually let me put the camera on so i can show you how massive this slide is so it starts all the way down there and goes all
The way through and i’ve got the card just so you can see the distance and this is about maybe one two three four five six seven eight nine ten eleven eleven football fields now the reason why i’m showing you how massive this lot space is is because this was just purchased by one of my friends to extend their repo yard they said that every time there’s something
Really bad happens they extend their yards so instead of renting it they’re actually purchasing this because they believe that the recession is going to be a lot longer than what people anticipate and the information they get from the banks is very scary so just to show you on how big and massive this lot is because like i said not only when you do repos you have
To keep in there if they file bankruptcy sometimes these cars sit for six months so you need to have something like eight to ten acres to store all these cars now this is just one company a lot of the other repo companies in vegas are also expanding so we hear one of the biggest options like it’s like the one of the businesses you don’t really want to have to see
Expanding uh is a car repossession business this is usually when you’re like let’s let’s let’s not have them expand like if anything can they shrink their lots and you know it looks like they’re all getting ready for massive expansion because they know what’s coming vegas if you look behind me you can see it i was going to show you from the inside as well as the
Outside but if i show you from the outside i physically have to take a car and drive so we can probably talk for about 10 minutes before i reach the end and this is what people don’t realize how big these auctions are and how many cars are sitting here because this mistake of all there’s not that many cars at the auction there’s you know the repo’s are not as bad
As what you say they are or what they say on the news but you gotta remember we were talking about this stuff like four months ago you know when everybody was still opening their cars insanely high and now that the repos have shut up i’m going to show you why so we’re going to go over here we’re going to go over to the side so right behind me is what’s called the
Staging area if you look right here you’ll see a line of cars damn near a mile long six seven semi trucks full of vehicles this is where the repos trade-ins everything else come to get staged now the reason why i’m showing you this particular area is all the cars that you see in the auction are not all repos so i don’t want to premise that but a massive majority
Of the ones i’m going to show you over this way are all repos so trade-ins everything else gets staged over here a lot of the repos depending on how many they have they trickle out they’re not stupid they’re smart so if the bottom falls out on crypto everybody has a fire sale and that’s why the price drops but wells fargo bank of america a lot of these other
Banks are really savvy so they’ll get let’s say there’s 5 000 repos right behind me they won’t let them all run at the auction that week they’re going to take maybe 100 this week 100 next week and just keep doing it even though there’s more and more i think when i first saw this there was probably like maybe 100 maybe 200 cars now there’s probably in the thousands
Sitting behind me that are being staged waiting for that now you gotta remember they go to the repo yards first where they fill up where if they fall bankruptcy the car can sit there for a few months and before it even makes its way over here once it gets here now it’s ready to be sold or it’s on a permanent hole for whatever type maybe legal action lawsuits bad
Bit numbers whatever the case is then it gets staged here so all the cars you see right here are pretty much ready for sale and that’s the scary factor so we’re going to go inside i’m going to walk around and show you a little bit of not only the bank repos but what’s going on in the dealer auctions to let you guys know that the market is slowly falling and the
Prices are gonna be going down don’t believe the hype don’t believe what dealers are talking like oh there’s a shortage of cars there’s not and i’m about to show you why so i want to let you guys know that this was definitely recorded yesterday because you know how i know this was recorded yesterday because it’s almost never cloudy and rainy in vegas and yesterday
It actually was so this was definitely recorded yesterday man this on a wednesday and the reason why it’s very important is because everything you see behind me will go back this way there’s rows and rows and rows of cars if you could see up to this yellow fence that’s way back there the reason i’m showing you this is this is what’s called a non-sale these are all
Cars that ran last week because most dealers we have until tuesday to pick them up and then they get moved over past the yellow fence so these are all the cars that are non-sale and not only are they non-sale um they’re priced too high and so what’s happening right now is they’re gonna open these gates in about an hour and they’re gonna start bringing all the new
Cars from this week so all the new cars that you know went through repos bankruptcies uh trade-ins everything else are gonna start working their way in and they’re gonna fill up all whatever spots playing in these lanes this is why i want to show you guys this because i tell you guys numbers and statistics and you guys like hey seeing is believing when you have
This many cars and we’re talking thousands for non-sales basically dealers are asking way too much so if the car is worth 20k most dealers want 25k at the auction it’s stupid it’s ridiculous they can’t keep doing this this was okay when the lats were empty but now that they’re starting to fill up like i don’t think you guys realize how big this is and how far
This goes back like i said i’m only showing you a quarter of it these are just the cars that are running for auction this week so not only are these the non sales for thursday also from friday here in vegas so like i said it’s very scary to see that this many cars are piling up and they’re still bringing their cars where there’s thousands of cars that are waiting
So when people keep telling me oh lucky i can’t get a deal on a car there’s nothing there there’s nothing there go to your auction take the time walk from one end i can’t even show you this thing is like 17 parking lots and i’m sure your auctions and your state and your city are just as big and a lot of them have off-site stores they don’t tell you guys about
That’s where they’re holding cars like wells fargo vacant america ally where a lot of the big repo’s are sitting at because they don’t want to basically show up and drop five thousand cars and follow these up because they know that if there’s that many cars it’ll drive the price down so like i said there’s a little little spoon feed one by another so you know
What’s crazy is a lot of these cars are nice cars like camaros and like new suvs and new nice trucks and things like that that’s the craziest part it’s like it’s not like it’s a bunch of you know piece of piece of junk cars or something like that one one point i want to make here i think is very important is when use you should never make money for driving a car
For a certain amount of time unless it’s some rare historical car or something like that you know the amount of people i know that have made money dro driven their truck or their car or their corvette or whatever for six 12 months put a bunch of mileage on it and was able to sell it for a profit in the past 12 to 18 months that’s not the way the market’s supposed
To work you know there’s you’re you’re you’re the doom and gloom is coming when you’re in a market like that that should never ever happen i don’t want to again i’m going to hear about any of the excuses you’re an unnatural market that you’re in a bubble and that will 100 pop and we’re starting to see the glimpses of it happen right in front of our eyes and this
Is just the start now that i’ve shown you this like i said these are all the non-sales for this week or last week that are going this week plus we’re gonna have some more coming in so i’m gonna go ahead and walk you to another site and show you what we’re working with so we finally made it to the yellow fence and i’m gonna show you guys exactly what i’m talking
About so if you look behind me there’s all these cars that are basically being staged for next week’s sale like i said there’s thousands of them here if you look behind me there’s this yellow fence everything back that way is all the cars that are being staged uh for either hold for repos they’re waiting for service um some of the banks are holding them for you
Know like i said they trickle out the effect and i can’t show you how deep this is because right now they’re actually doing an inspection but i’ll try to see if i can hold it up so imagine literally one mile driving this way full of cars now that’s just here in vegas we actually don’t even have that big of an auction the ones like in riverside california sacramento
They’re like two times the size of this one texas dial same thing there’s a lot of auctions have just like this where there’s thousands upon thousands of cars that are just sitting here waiting to be uh sent up to the auction so like i said don’t believe the hype there’s more than enough cars to go around they’re just feeding that need of oh it’s uh you know just
Like diamonds there’s a million diamonds but they’ll never drop the price only release so many at a time to keep the values high same thing with used cars that’s why i’m the scariest part of this is this the scariest part of this is you see this happening right and you see all these repos and stuff happening like that right and here we are at a time period where
Unemployment is still under four percent and you’ve got to say okay what happens when unemployment starts to climb what happens when a few million jobs are lost what happens when the economy gets even in a weaker state let’s say three months six months if that happens right and it’s like what’s going to happen with repossessions in that situation if it’s already
Getting this bad this fast and these are things i think you know you have to consider and if this is why this is just one of many various reasons why it’s so hard to be bullish on the economy and you know it’s a good time to be picking up assets um as somebody you know in in the markets and whatnot and it’s going to be even more attractive over time but yeah you
Know the used car market could you know this could be a mess for on my opinion years to go in the future everybody you need to just brace yourselves be patient don’t buy anything right now just you know wait a little bit because like i said you go by dealerships before it used to be empty you know most of the dealerships look like this parking lot just empty now
You look at dealerships they look like this they’re just rows and rows and rows of cars so now that there’s so many slowly starting to fill up you need to basically be cautious and be ready for the market to change if you’re a dealer start liquidating your inventory do not hold on over priced inventory because with all these cars being non-sales these a lot of
These are owned by either banks some of these are owned by dealers and the problem is they probably let’s say they bought this car they use their lines of credit or their flooring to book this car for like eight thousand dollars when it’s all really worth like four now they have to liquidate it because the foreign companies probably like hey you need to get rid of
This car get off your line of credit move it because dealers are on a timeline when it comes to flooring cars on their lines of credit so you need to get them on there and get them off there so i’d say about maybe 20 of these are overpriced cars that dealers are stuck with and they can’t liquidate them so that’s why they’re running as non-sales because they asked
So much for a reserve because they bought them overpriced they put way too much money into them and now they’re over retail and they can’t even get wholesale for them so this is why the slot little by little it’s gonna fill up i remember during the pandemic there was three rows of cars right here that was it now look at this thousands of cars every week so anyways
I want to show you guys this we’re gonna go back to the studio i’m gonna go over some numbers with you guys and explain a little bit more how it works and show you some interesting stats after watching and something uh you know to add insult to injury in this whole situation is you know as a fed continues to increase interest rates it makes it even more unrealistic
To obviously buy cars because now it’s even more expensive never mind if banks start to get more and more freaked out they’re not going to want to loan as much like you know all these things just funnel the wrong videos i don’t know how you can not be scared of what the economy is going to turn to because this is just a huge indicator of what’s to come when you
Have multiple repo companies embracing for one of the biggest booms that they’re gonna have they’re gonna be buying more tow trucks they’re gonna be getting bigger yards and like i said a lot of these loans that we were talking about i forgot to mention in the beginning but these are not subprime loans some of these are prime like a lot of these exotic cars we’ve
Been repointing like the rolls-royce was like at 1.9 percent through some credit union a lot of these loans were under three percent for the exotic cars and so that’s what’s going on it’s not just you know people bad credit or defaulting we’re talking about good people that had money and some of these people are business owners and a lot of these repos especially
The exotic cars that we picked up they were also had ppp loads so some of those people basically took that money and probably put down payments on some of these cars that they shouldn’t have got but that just gives you an indicator of what’s going on now as we walk through the actual auction i’m hoping that put some sort of information in your head because when
I tell people there’s so many cars at the auction and you just gotta wait for a good deal they think i’m joking like you saw right there every week there’s hundreds if not thousands of cars that go unsold so when you’re going there as a dealer and we’re waiting we’re holding up our hand like oh yeah i’ll bid 20 grand on this car and i’ll bid 30 thousand dollars on
This truck no sale no sale we want more money so what happens is they roll up the next week once again i show up the next week hey i’ll be 20 000 for this one 30 000 for this one once again no sale or roll back but every week that does the no sale more and more cars start feeding into that pool and that’s why when i showed you that lot i physically wanted to show
It to you because now you guys can see that there’s the supply is not dwindling there’s no huge like oh my god the supply is empty literally if you go back to my videos you can see during the pandemic there was literally two lanes of cars running every week that was it very small maybe 100 maybe 200 cars now we’re running thousands every week back to where we were
Before the pandemic so this bs of oh it’s it’s supply and demand no you can drive down any street especially here in vegas we have this main street called sahara you can drive down that street every dealership is packed to the gills full of cars i remember like right down the corner sahara dodge dodge is one of the most popular trucks and if you look at some of
The other slides we had is one of the most highly repo trucks but they had over 60 brand new trucks in stock ready to go you know nothing custom ordered especially they just had 60 trucks parked right out there they had another right next to that another 60 70 jeep wranglers so that just lets me know that like i said the market is not what it used to be if you
Look at some of the articles i’ll try to post a few up here that every manufacturer is reporting double digit loss of sales every month honda reported 13 decrease in uh first quarter sales and second quarter sales they’re not that far behind so that should just let you know that if honda one of the most i guess dependable most loved vehicles and is being basically
Undersold and they’re not buying that should let you know that this is going all the way across the board even ford ford i think was 11.5 percent and they have ford motor credit they have one of the biggest and most relaxed banks to get people financed with bad credit and even they are slowing down so like i said these are just some of the telltale signs of what’s
Going on now i’m not doing this to freak people out i’m doing this to help educate you guys because when i did this video i thought that more people would be interested in like seeing behind the glass like how i actually do business because i know no no nobody else in the car business does this nobody else is going to take the time to walk around talk to bankers
Talk to dealers talk to uh auction houses and all this other stuff so i want to give you the stuff that i do every day so this way you can make some sense out of it whether it set you up to buying a car or maybe let you know where to invest i don’t care thank you lucky lopez for that video uh we do appreciate it i love any insights we can get on industries that
Um because i guarantee you 99 of you guys that you know watch this video right here you’ve never seen anything like we just watched right there right and i think that this sort of information is very valuable in a time period when um obviously there’s a lot of fear about the economy and um yeah so i hope you guys appreciate me joining you know sharing a video like
This with you guys i hope lucky lopez continues to update us every once in a while on what’s going on here over the next six to 12 months i think it’s going to be really really important much love as always guys and have a great day
Transcribed from video
The Cars Are Getting Repo'd By Financial Education