BANKS and finance houses are holding back on car repossession in this economic downturn, despite a rising number of loan defaults, say industry sources.
They cite a soft resale market here and weak demand abroad as reasons. With slack demand from abroad, the re-export market, along with the resale value of cars in general, has been hit.
In this climate, a bank which repossesses a car may not be able to recoup the sum it is owed.
Lenders mum on number of cars repossessed
by Christopher Tan
NO ONE appears to know exactly how many cars are being repossessed here.
The police, which banks and other lenders have to inform when they repossess a vehicle, say they do not collect data on the number of vehicles repossessed.
The Monetary Authority of Singapore (MAS) has figures for only three finance houses - Hong Leong Finance, Sing Investments & Finance, and Singapura Finance - out of the dozens of car-loan providers in business. In the first nine months of this year, these three lenders repossessed 156 cars, the MAS said.
Car loans drive some to insolvency
RESTAURANT executive Owen Lau and his wife were made bankrupt in July over the $100,000 or so he owed OCBC Bank for one of their two family cars.
Mr Lau, 36, could not continue servicing the loan on the Honda Odyssey when his food business failed. His wife, a sales coordinator, was the loan guarantor.
Maybank moved in to repossess the couple's other car, a Suzuki APV, when it learnt of OCBC's action against them.
