Due Diligence and Ongoing Monitoring

Is anyone willing to share what due diligence documents you from Collateral Recovery/Repossession Companies.  I am getting some push back for trying to collect their repo license and a certificate of insurance.

When assessing repossession vendors, consider industry standards specific to the state where they operate. In California, certain requirements must be met, including having proper insurance coverage and a repo license. The type of insurance needed depends on your organization's specific requirements and contractual agreements. Here are some key aspects to verify during due diligence:

1. Insurance Coverage and Limits: Basic coverage should include workers compensation, automobile liability, garage keepers, cargo on-hook, and employee dishonesty coverage.

2. Handling Customer Complaints: Evaluate how vendor addresses customer complaints.

3. Personal Property Handling: This is crucial in the industry; ensure vendors handle personal property appropriately as it impacts consumers.

4. Repo License and Business License: Confirm that vendors hold the necessary licenses.

5. Client-Facing Procedures: Examine procedures related to breach of peace requirements.

6. Employee/Agent Training and Certification: Industry standards, such as CARS or SAS by Eagle Group, may apply.

Majority of these vendors are small-scale providers and may not have all requirements documented. In such cases, having a well-defined contract or agreement becomes essential. Note that forwarders and aggregators may use these vendors as 4th parties to provide service as well.