airplane repo yacht

I repossess private yachts worth up to $20 million when owners default on their loans. Here's what happens when I track them down.

• Ken Cage repossesses high-end luxury assets like yachts and jets whose owners have failed to pay their loans.
• Since 2005, Cage's team has repossessed 2,000 boats, some of which are worth as much as $20 million.
• Here's what his job is like, as told to freelance writer Jenny Powers.

I first met my buddy Bob Weeks when we were 10 years old, growing up in the suburbs of Philadelphia. Now, almost five decades later, we're in business together repossessing yachts and private jets from all over the country. 

It's our job to chase down expensive assets from people who have defaulted on their bank loans. At the end of the day, we're a bank's last resort. When the bank calls me and issues a repo contract, it means they've exhausted all of their internal efforts — their automated reminders, follow-up phone calls, past due letters, and administrative attempts to be paid back have been largely ignored by the borrower.

I usually come in around 60 to 65 days after the 'past-due' marker.

Once my repo team gets involved, it's time to kick things up a notch. My job is to retrieve the collateral any way I can, service it, sell it to a third party, and recoup the cash for the bank. My company only charges between $400 and $1,000 for the actual recovery; our real payday comes from the sale of the asset itself. The standard yacht broker commission is 10% but the rate decreases as the value of the yacht goes up, and we negotiate on a case-by-case basis with our clients.

Since Bob and I bought an existing repo company based in Florida in 2005, we've repossessed 2,000 boats and sold off more than half of them, ranging from a $1,000 1975 Trojan 32' to a $20 million Benetti 160'+. 

Most of the time when the bank gives us a repo contract, they provide very few details.

We usually get the debtor's name and last known address, and the year, make, and model of the boat along with the Hull ID or VIN number. The rest is up to us. 

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Banks can also simultaneously open the repo contract up to multiple repo companies, making our job even more challenging because then it becomes a race to see who can find the asset and repo it first. 

This happened to me and my partner, Danny Thompson, when we were on the Discovery Channel show Airplane Repo in 2014. We were repossessing a $3 million custom-built yacht when another repo crew showed up and began towing the boat with us on it. Danny managed to cut the tow line and I drove the boat away, leaving the other repo guys in our wake. That job alone earned us $300,000 commission.

For each repo, we begin with an online search of state registries. We also check the US Coast Guard history which provides the chain of ownership and any name changes for the yachts. Then we start making calls. Sometimes, we're able to locate a boat with just one call thanks to local spotters around the country keeping an eye out for us. 

At the end of the day, I'm not here to embarrass anyone — I'm just here to recover the bank's assets. 

When I do come face to face with a debtor, I always tell them no one has to know why I'm here. For all I care, they can tell onlookers I'm buying their boat from them and they're ripping me off. If they cooperate, they can save face. It's all about tapping into their ego. One guy even helped me by hooking up his own boat for me to repo so he didn't look bad. 

Often, deep down debtors are just relieved it's all over; they know it's just a matter of time until we catch up with them. But there are the belligerent types who will put up a fight. I had one guy in Maryland's Chesapeake Bay Area who chained the propeller of his boat to the dock in the hopes of causing damage to it, as one last shot at the bank.

Over the years, I've been in high speed chases on sea and land and dodged booby traps set up by angry debtors.

I've dealt with professional athletes twice my size looking to fight me, a drunk wielding a shovel at my head, being shot at, you name it. 

Even though I'm surrounded by boats, I've never owned one because I didn't have the time to enjoy it. Between 2005 and 2012, I was on the road about 250 days a year. But now that my four kids are older, we're looking into getting a 24'-30' fun family boat. One thing I know for sure is that I'll pay for it in cash.

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Airplane Repo True Stories

Stephen pope.

The airplane repo agent has been tracking this prey for weeks. Sitting on the ramp is his prize — a pristine, late-model Piper Malibu with a gorgeous paint job and perfect leather interior. A loan payment hasn't been made in months, and the bank wants this asset back now. It should fetch a premium price on the open market.

The airplane's owner has already lost his boat to foreclosure and is in danger of having the bank take his house. With the Malibu finally located, the paperwork in order and a thorough examination of the logbooks completed, the repo man is about to take his airplane too. All that's left is to climb aboard and fly off into the sunset.

As the bank-appointed agent begins the long walk across the ramp to the plane, the Malibu's keys held tightly in his fist, he hears footsteps nearby.

"Hey," a voice calls out. It's the airplane's now-former owner, who reaches out his hand. "Thanks again," he says, a weak smile on his face and sincerity in his eyes. "I know you tried to do everything you could with the bank to help me keep my airplane. I appreciate it."

They shake hands and bid a final farewell before the repo agent fires up the engine and taxies out. Months later a red envelope with a return address from the Malibu pilot arrives in the agent's mailbox. It's a Christmas card bearing a warm holiday greeting and wishes for a happy, healthy New Year.

Despite what you might have seen on TV, aircraft repossessions rarely go down the way they're portrayed by the cable programs. Run-ins with law enforcement are rare, fisticuffs with angry former aircraft owners even rarer, and nobody will ever hop an airport fence, make a hasty hydraulic system repair with a roll of duct tape and blast off into the night sky in an airplane they've never set eyes on.

Sorry to disappoint you, but if you're a fan of the repo reality shows, what you're seeing on the screen might not be 100 percent real after all.

Repo Realities

Just ask top aircraft repossession professionals. Well-known repo men like Nick Popovich and Ken Hill have been doing this job for decades. Over the last 20 years Hill has personally repossessed more than 1,000 general aviation airplanes for the banks. Popovich has been at it almost twice as long, repossessing everything from King Airs to multimillion-dollar private jets and airliners and even an entire fleet of helicopters in one fell swoop. Both admit they've found themselves in some sticky situations — but they say that in the vast majority of cases aircraft repossessions normally involve lots of detective work but little actual made-for-TV drama.

"The real airplane repo business is nothing like you see on the TV shows," Hill says. "Rarely do I show up to repossess an airplane and somebody doesn't know I'm coming already. If I haven't called the airplane owner in advance to let him know I'm on my way that day, then the bank has already sent him three notices telling him I'm coming."

Airplane repo shows also rarely give the viewer a sense of how long the repossession process takes from the time the bank-appointed professional shows up on airport property until he's swinging onto the active runway for departure. "It can take a few hours or a few days," Hill says. "I don't ever hop in an airplane without knowing its airworthiness status. Not under any circumstances."

There will be times when maybe it's impossible to locate the airframe or engine logbooks, Hill admits — perhaps because they're locked up in a hangar somewhere or because the owner has refused to hand them over — but in those cases, the repo professional merely needs to be creative. While remaining well within legal boundaries, snooping can often yield the best results. Normally the first person to talk with if the aircraft owner can't be located and the logbooks are missing is the mechanic who performed the last annual inspection or repair work.

It might sound risky to rely on the word of an unknown third party for your personal flying safety. But even if it turns out the mechanic is a friend of the airplane's owner, it's still the maintenance professional's name that goes in the logbook for any inspections performed — not to mention his A&P license that's on the line. "I've found that the mechanics I've dealt with are concerned first and foremost with the safety of the person flying the airplane, whether it's the owner or not," Hill says. From his thousands of hours of flying experience, Hill says he also has an intimate knowledge of piston and turbine airplanes that can help him make safe go/no-go decisions in just about any aircraft he's repossessed.

If the logbooks are missing or there are other anomalies with an airplane, oftentimes it will be necessary to obtain a ferry permit from the FAA — allowing an airplane with an expired annual, for example, to be flown to another nearby airport where necessary work can be performed. The process involves visiting the local Flight Standards District Office and asking for a special flight permit to transition the airplane from point A to B. It's not exactly the kind of stuff a general TV audience would find enthralling — pilots would probably love it though.

Really, the true-life stories of airplane repo men and women are ­immensely interesting and entertaining. Popovich started out in the repo business in 1979. Over the last 35 years he's seen just about everything you can imagine. He's repo'd airliners and private jets on every continent. In rougher parts of the world — places like Russia and Colombia — his firm hires bodyguards. If a situation escalates to physical violence, the protocol is to simply walk away. He once tricked a problematic private jet owner into handing over an airplane by phoning up to charter it. When the airplane rolled up to the FBO to pick up its supposed load of passengers, Popovich's team slapped a repossession notice on the side of the jet and claimed it as its own.

Best of Times, Worst of Times

In general, when times are bad, business is good for professionals like Popovich and Hill. But this last downturn was different, they say. In the wake of the 2008 economic collapse, with a flood of business jets and general aviation airplanes hitting the used market, Popovich, for example, now advises banks to do everything in their power to avoid repossessing an airplane.

"In most of the cases right now, especially in corporate and general aviation, the banks are so far underwater on the loan balance that to repossess an airplane and then pay to store it and resell it, it really doesn't make economic sense," he says. "As long as it's still being maintained and insured, they're better off working something out with the borrower."

Popovich's firm, Sage-Popovich Inc., has created a program for banks and jet owners that lets the borrowers maintain possession of the airplane and start paying down the loan, usually under new terms. Popovich and his team then keep close tabs on the aircraft to ensure the borrower is holding up his end of the bargain.

Revenue the company receives from aircraft monitoring, periodic inspections, appraisals and other activity, in fact, now exceeds what comes in from aircraft repossessions. There's method to this approach, of course. Being proactive about monitoring the status of a borrower's aircraft means Popovich is never too many steps behind an owner in determining the location and condition of a given airplane. If it eventually comes down to repo'ing the airplane, Popovich's staff already has a large file on it and should have a good idea of where to find it.

Grab and Go

That's always the first step in any airplane repo job — finding it. Once the repo pro locates it, sometimes no easy job, he or she then affixes a repossession notice on the airplane and calls the local police to explain what's going on. "We let them know we've just repossessed an airplane and document the time, date, officer's name and report number," Popovich says. "The police department will normally send out an officer and file a report. Then technically the airplane is ours." From there, Popovich says, he arranges to pay for any outstanding hangar fees, fuel and maintenance. Once the airplane is legally his to take, he can simply drive up and offload his crew. Then it's a simple matter of grab it and go. That normally means towing the airplane to another spot on the airport for hours of close inspection before flying it.

"Since 9/11 it's become more of a mental process, trying to figure out how to gain access to the airplane without breaking the law," Popovich says. "We have to figure out how to work with, or around, the security at specific airports — and that's frankly one of the reasons we bought our own airplane. It's much easier to fly into an airport yourself and take your target than to figure out how to get around the security fence at an airport you're not badged at."

As you might suspect, adhering to federal aviation regulations can make the aircraft repo agent's job much tougher. The FARs, for instance, say that in order to obtain a ferry permit you need written permission from the airplane owner. Obviously in some instances that's not going to be easy to get, especially if a desperate owner has skipped town or left the country. In those cases the bank usually must complete all the repossession paperwork, wait for legal transfer of ownership and file for a new registration with the FAA. It's time-consuming, and again not exactly the type of heart-pounding excitement that makes for great TV viewing.

In the old days, Hill and Popovich say, the airplane repo profession was a lot grittier, with characters who were far more willing to bend the rules to snag an airplane. But in the post-9/11 environment, airplane repo specialists find they must operate more like private detectives than thieves in the night. Nowadays there's the ever-present threat of being arrested — or worse, of getting slapped with a lawsuit. As a result, the typical aircraft repossession these days is likely to involve a lot more paperwork than in the past and fewer made-for-TV moments.

However, action is what draws TV viewers and, in turn, television advertisers. Each week, fans of the Discovery channel show Airplane Repo are treated to nonstop action and drama as the series' repo men and women do whatever it takes to track down an airplane. The show's stars claim the action isn't faked — though the producers admit that given "the fast-paced and dangerous nature" of this line of work, the repo men and women often find themselves in tough situations and "as a result key identifying information is sometimes changed and select dramatizations employed."

Drama on TV

If you've ever tuned into Airplane Repo and know anything about aviation, you may have been confused by the antics of the show's stars, who appear to commit multiple felonies and bust all kinds of aviation regulations as they surreptitiously break into hangars in the middle of the night, make hasty aircraft repairs and then take off with GoPro cameras conveniently attached to the belly or tail for the benefit of viewers at home.

A number of pilots have taken to Twitter and Facebook to criticize the show for its negative portrayals of aviation, labeling it a farce. Popovich and Hill also dismissed such shows as presenting unrealistic portrayals of the repo profession. Nonpilot fans, meanwhile, eat it up, and the ratings have remained consistently high for these kinds of shows.

Airplane Repo actually started out in 2010 as a more true-to-life, unscripted documentary series. The first season starred Popovich as he traveled around the world repossessing business jets and airliners for big paydays. While that version of the program was well received by pilots, many viewers tuned out. It was also expensive to make as film crews traveled with Popovich and his team around the world over several months to bag an airplane.

"When we did the show originally, everything in it was actual footage of how we did a repo, from the planning session all the way through the execution of the repo," Popovich says. "The second season they hired a new cast and they staged a lot of it. They wanted more drama; they wanted more fighting, more breaking into places." The reality, he says, is that, by law, during a typical repo "you can't breach the peace. What you see on TV, if I did that my client would get sued, and I'd get sued and probably arrested."

The rebooted show, starring well-known repo pilots such as Kevin Lacy and Mike Kennedy, costs a fraction of the money to make and is more entertaining to a broader audience. And while some of the action on Airplane Repo is staged, the stories these pilots recount — like spending five days in a Mexican jail after landing an airplane at night after an electrical system failure, as Kennedy once did — are real. When it comes to flying unfamiliar airplanes in challenging places, these guys are the real deal.

One of the ever-present dangers for professionals like Popovich, Hill, Lacy and Kennedy, of course, is flying an airplane with an undisclosed mechanical problem. On a few of the high-value transactions he has dealt with, Popovich says he's ordered borescope inspections of the jet engines to ensure there was no damage that might make the airplane unsafe to fly. Hill says he's been tasked with flying airplanes that haven't moved in years. And angry owners aren't the only things to look out for. "I once picked up an airplane in Arizona where there were rattlesnakes crawling around in the wheel wells," he says.

What if you're the person who has fallen behind on your loan payments and the bank is breathing down your neck? How should you react when you get that phone call from the bank or the repo man? You might be surprised by just how many rights you have in such a case. Your first step should be finding a good aviation attorney who has dealt with loan defaults and repossessions.

If you're behind on your payments, you'll probably know that already, unless somebody else handles your finances for some reason. The bank will begin the formal repossession process by sending notices in the mail and following up with phone calls to make sure you're receiving the notices. The most important person during this part of the process isn't the repo man; it's the bank's collection officer assigned to your case. Try to negotiate something with him or her first.

Once the bank hires a repossession agent, that's when things get serious. The repo agent will start with some good, old-fashioned detective work to find out where your airplane is located. There are online databases and tracking services like FlightAware that repo men use, but if an owner doesn't want his or her airplane found, it can be a long and arduous process to track it down.

After 60 days from the start of the default proceedings you'll probably get a phone call from the repo agent or a bank representative with the bad news. At that point you have a choice. You can cooperate and agree to meet the repo agent, or you can dig in your heels and try to keep him or her from taking your airplane. If you elect to cooperate, part of that process will involve signing a release stating you understand you are in default and authorizing the bank to take back the asset.

Once the repo pilot takes the keys and has finished his inspections, he'll be gone in a flash. But this isn't the end of the story. You as the former owner legally still have 30 days to pay the bank and get your airplane back. Once that 30-day period ends, you'll be given an additional 10 days' warning to pay the bank or have the asset liquidated. At that point the bank has the legal right under the Uniform Commercial Code, Article 9, to go ahead and sell your airplane to the highest bidder.

The story still isn't over here. If the bank sells your airplane for less than you owe on the note, you can be sure it will come after you for the difference.

Buying a Repo Airplane

What about buying an airplane that has been repossessed? Can somebody else's financial misery land you a sweet deal? The federal government runs an auction website that includes seized aircraft, but there is no central online resource listing all repossessed aircraft for sale. Your best bet is to browse sites run by well-known repo firms and inquire about the airplanes you're interested in. The banks almost always rely on brokers and agents to advertise and sell repossessed airplanes, although there's a good chance the bank will be directly involved in the sale — especially setting the final selling price.

The longer a repossessed airplane has been sitting on the market, the more willing the bank will be to cut a deal. Once the bank accepts an offer to buy a repossessed airplane, the purchaser has 10 days to inspect it and make a decision as to whether to go ahead and buy it or not. You can inspect the interior and exterior, have a mechanic look it over, and examine the logbooks — pretty much anything you want short of actually flying it.

So can you save money buying a repossessed airplane?

"You're going to get what you pay for," Hill says. "If it's a really good, marketable airplane that everybody wants, then it's going to sell for a premium. Just because it's a repossessed airplane usually won't make any ­difference on a good airplane. A lot of people think they're going to get a steal buying a repossessed airplane, but really that doesn't happen."

One thing to keep in mind is that most repossession pros would rather not have to take your dream airplane and post it on a website for sale. They genuinely feel bad when they show up to retrieve the keys. Hill says that when he becomes involved in a case he always tries to have empathy for the owner and give him or her as much time as the bank will allow before moving in.

"I'm there not because I want to be there but because I have to be there," he says. "Most of the people I encounter are pretty sensible about it. I give them all the time in the world that I can right up until the point that the bank says go. But I try to help them keep their airplane if I can."

And, yes, Hill says he still receives Christmas cards from people whose airplanes he's repossessed.

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Airplane repos: the inside scoop on losing your swag .

With Ken Cage , Host of Airplane Repo on the Discovery Channel, Founder of IRG Group

Podcast: Play in new window | Download

Sometimes, being a re-possessor can get depressing.  Especially if you’re taking minivans with child seats in the back away from middle-income Americans. Steve’s next guest, Ken Cage , did just that before moving up to luxury repos.  Ken decided he’d rather repossess stuff from the rich and famous.  We’re talking private jets, yachts, luxury cars, and more.

Ken subsequently hosted Airplane Repo , a long-running show on the Discovery Channel.

Starting IRG Group

Earlier, Ken worked at Daimler-Chrysler, collecting delinquent auto loans.  After a while, he realized that he did not enjoy working at a big company.  He wanted to be his own boss.

His wife opposed the idea.  She thought the repo business would put Ken’s life in danger and their young family’s finances at risk.  As luck would have it, she watched an airplane being repossessed on television and suggested Ken do upscale repos instead.

With his wife’s greenlight, Ken teamed up with his friend, Bob Weeks and started IRG Group in 2005.

IRG Group (International Recovery & Remarketing Group) is a full-service international firm.  It specializes in the investigation, recovery, and remarketing of specialty assets such as yachts, planes, and more.

Canary In The Coal Mine

In its first two years in business, IRG got about 100 repos per year, with an average value of $40,000 to $50,000.  Then, in the third quarter of 2007, repo asset values started to climb to $200,000 and more.  Ken was excited because this meant higher commissions for IRG.

But the jump in repo values was like the proverbial canary in a coal mine.  It was a sign of something deeper and darker at play.  Because shortly thereafter, America was hit by the severe recession of 2008.

People started falling delinquent on all manner of loans.  IRG’s repo volume jumped three-fold, to an average of 300 per year between 2008 and the end of 2011.  At the recession’s peak, IRG repossessed over $30 million in assets every year.

About 70% of his debtors were in the real estate business, in one way or another.  Most of the debtors were in their 40s and 50s.  They had taken on loans with very little “margin of safety”.   When bad times hit, they had no choice but to default on their loan obligations.

A Return To Normalcy

Now, ten years later and with the recession firmly behind us, Ken’s repos are more diversified.  They span multiple sectors and multiple geographies.  Additionally, repo volumes have dropped, partly because banks have been very conservative in their lending.  Current repo statistics, Ken believes, reflect a return to economic normalcy.

46—The Magic Number

As an aside, Ken notes that banks start auto-calling borrowers when they are 14-days behind on their payments.  These calls prompt most customers to send in their checks.  However, when loans go 30-days past due, banks get more aggressive in tracking down debtors, with in-person phone calls.

Banks have 120 days before they’re required to write off bad loans.  When debtors do not respond after 45 days, loans become past due on day 46.  At this point, the likelihood of a repo goes up dramatically.

Within two weeks of the 46-day mark, re-possessors get to work.  They get about 60-days to track down assets, repossess them, and sell them.  Subsequently, banks get the cash that’s been recovered and do not have to write off the loan.

Repossessing Luxury Items Isn’t Business As Usual

Repossessing a car is one thing.  Repossessing a Gulfstream jet or a luxury yacht is something else altogether.

For instance, it cost Ken over $100,000 to transport a Gulfstream jet from just Fort Lauderdale to Orlando.  Costs included fuel, pilot’s fees, and related expenses.  Additionally, the cost to store these assets often runs into a few thousand each month.  Ken’s commissions also get taken out of the sale.  So, repossession costs quickly add up for larger assets.

Ken estimates that after expenses, banks recover about 50 to 60 cents on the dollar.  They then go after the debtor for the balance of the loan s/he took out to buy the asset.

On The Sets Of Airplane Repo

Switching gears, Ken speaks to what it’s like to film the show, Airplane Repo .

While he’s filming, he wants to protect IRG’s reputation.  The production company, on the other hand, likes drama and wants to tell a compelling story.  As a result, Ken is sometimes at odds with the production company and needs to balance things out.

He also faces legal restrictions on what can and cannot be shown on television.  So actors are often called in to recreate certain scenes.

Off the show, when Ken does his job, he is often in quiet listening or thinking mode.  But a reality show requires action all the time.  So there’s more pressure to talk about what’s going through his head to keep the show’s tempo going.

On the show, when he tracks down the asset he needs to repossess.  He can’t just say, “Alright, let’s go!”  The show’s producers want to make the moment dramatic.  In Ken’s case, his cheer is “Yahtzee!!”

Word Of Advice

Ken’s parting words of advice to all debtors: If you make a promise to pay, keep your word.  In the repo business, broken promises shatter trust very quickly and hurt debtors in various ways.

Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United Capital. Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph or marketing piece to make decisions.  Content provided is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered tax, legal, investment advice. Please contact your tax, legal, financial professional with questions about your specific needs and circumstances.  The information contained herein was obtained from sources believed to be reliable, however their accuracy and completeness cannot be guaranteed. All data are driven from publicly available information and has not been independently verified by United Capital.

Steve Pomeranz: We’re back with Ken Cage, the repo man from Discovery Channel’s show Airplane Repo . He’s the guy who will come and get your private jet, your yacht, or your luxury car should you be just a little late [LAUGH] on a loan. Ken, welcome back.

Ken Cage: Thank you.

Steve Pomeranz: Hey, so what is the bank’s point of view here?

Real quick, I mean, when is a loan overdue, when do they feel like they’re at most risk, and when do they bring you in?

Ken Cage: So, generally speaking, they consider it overdue one day past due. They start collecting, generally speaking at 14 days past due and that could be through robocalls. They get nervous at 30 days past due.

Steve Pomeranz: Define nervous.

Ken Cage: Because at that point they’ve tried for two weeks to contact people to get the payments brought in because a lot of times people just forget. They could be on vacation, any number of reasons. One phone call generally spurs on most people to make the payment.

Steve Pomeranz: Yeah.

Ken Cage: So once they get to 30, then they’re thinking, we’ve been trying for 15, 16 days, no response. Now they start to escalate things, as far as they call twice a day, they’re physical calls as opposed to robo calls. So now they’re digging in, and that’s what we used to do.

They’re always told at 46 days past due, that’s a magic number. If it gets to 46, the likelihood of a repo goes up dramatically.

Steve Pomeranz: Yeah, they have the stats that show where that kind of critical point is.

Ken Cage: And they always said 46 was it. So from 30 to 45, the collection teams are really working. They’re trying to find relatives; they’re trying to find associates; they’re trying to find businesses, all that kind of stuff.

Steve Pomeranz: Now, let me interrupt for a second because at six months, is the bank required to charge that loan off and to take it as a complete loss?

Ken Cage: 120 days is the charge-off number.

Steve Pomeranz: Okay, 120 days, okay.

Ken Cage: Yeah.

Steve Pomeranz: And a bank doesn’t want to do that.

Ken Cage: No. So that’s why, in most cases, they call us somewhere around 60, 65 days past due.

Steve Pomeranz: Okay.

Ken Cage: So that gives us plenty of time to go, make contact, repo the asset if need be. Even sell the asset before the charge-off point. So, but that was a huge difference, as well, really in 09, 10, and 11, is they would wait till 80, 85 days past due, which put a lot of pressure on us, so.

Ken Cage: But normally it’s 60 to 65 days past due, they’ll call us.

Steve Pomeranz: What happens when they charge it off? Why is that something they want to avoid at all costs?

Ken Cage: Because that’s a loss that they have to report, and then if we do sell the asset after that, it’s an accounting thing that drives them nuts. They hate the charge-offs,-

Ken Cage: Because it’s a loss for them, and the repo’s a loss too. But if they can get the asset repossessed, and we as the licensed broker that sells these assets can get the cash back to them, they don’t have to go through the charge-off process, so the actual loss isn’t as great.

Steve Pomeranz: Okay, so paying your expenses, paying your commissions, paying for the cost of obtaining these assets, I want to go into that right now. So it’s one thing if you were to go and pick up the minivan that I spoke about at the top of the show, but if you’re picking up a Gulfstream, or a luxury yacht, I mean it can be pretty expensive to get it back home.

Ken Cage: Absolutely. I mean, the fuel to fly. We picked up a Gulfstream III down in Fort Lauderdale a little bit ago, and the fuel costs alone is a five-figure cost, just to go from Fort Lauderdale to Orlando. By the time you get the pilots in there and the fuel and everything else, because you can’t run it empty, so you have to put in a significant amount of fuel. The pilots cost you money, you need two of them, so moving these things is expensive. The cost to store these assets is thousands a month for the bigger assets. A Cessna 172, that’s obviously a lot less. But yeah, the bigger assets, it’s very, very expensive, and then we’re brokers, so we charge a commission, which gets taken out of the sale. So the costs add up really, really quickly for the banks. And in those cases, they can’t sell it for as much as what the amount it is anyway.

Steve Pomeranz: Well, that’s what I was going to say, and I want to get into that in a second too.

So if we’re talking about 100 cents on the dollar, whatever the amount, the value of the asset was new, and kind of just vaguely coming up with a percentage of what they would expect to receive back after all of the costs of moving the vehicle, of storing the vehicle, of paying the commission of getting the sale and all that, what are we talking, $0.50, or more or less?

Ken Cage: Probably by the time you net everything out, after all the expenses, it’s probably somewhere in the $0.50 to $0.60 range.

Steve Pomeranz: Which I guess they’re happy with, right?

Ken Cage: The banks are happy with it, but at the end, they have to go after the debtor for the deficiency balance.

Steve Pomeranz: Yeah, yeah, so that’s expensive, too.

Ken Cage: It is, and it’s tough. They don’t want to do that.

Steve Pomeranz: Yeah, it was like during the mortgage crisis or during the home crisis where everything was foreclosed, I mean, the banks really are in the business of being residential property owners. They’re kind of bad at it actually.

Ken Cage: They’re terrible and they’ll tell you that. Their business and their commodity is cash. They’re great with cash, that’s what they want to work with, and that’s it.

Steve Pomeranz: Yeah, all right, so I’m a value investor, and this perked my ears up when I was reading about it and reading about you. So you’ve got this asset that was worth, let’s just say it’s a 50-foot yacht, and I don’t know what they go for, let’s say they go for $600,000.

Ken Cage: Okay.

Steve Pomeranz: Now you’re telling me that kind of the value is $300,000, let’s just say. I mean, that boat is sitting in your marina, and you’re a broker, and now you’re willing to sell it. Is this a good place for me to go to find great values?

Ken Cage: It can be, yes. Absolutely, now with the economy being stronger right now, I’ve been posting a lot of sales on my LinkedIn page, and we’re actually getting more than the banks are asking for consistently, and we’re getting it in 30 days.

Ken Cage: So, there’s value there for sure, no doubt about it, but I would say the values aren’t as great as they were three years ago. Because there are more people with cash, so obviously, there’s more out there buying-

Steve Pomeranz: Yeah, well, cash is king, so in bad markets, if you have cash, I mean, you’re dictating terms, and as I said, cash is king.

The other thing that occurred to me when you were talking about the banks robocalling them and then a person calling them, is that you can’t say the check is in the mail anymore because they’ll say well give me your account number, and we will ACH the funds right now. You can’t get away with that anymore.

Ken Cage: You’re absolutely right, and honestly, that’s one thing too that people have to understand—if you’re behind, if you make a promise to pay, you better pay because that’s something that the collectors also consider when they’re making decisions on next steps.

Ken Cage: If you have a broken promise, it’s the trust level, for obvious reasons, drops a little bit. If you say you’re paying on Tuesday, pay on Tuesday.

Steve Pomeranz: Of course, yeah. Well, also, I would think that those people are professionals. The banks are professionals, they do this. You’re a professional, you do this every day, all the time, and I’m a guy who decided to buy a plane I can’t afford. So if you’re at the poker table and you’re wondering who the patsy is, you’re the patsy. [LAUGH] That whole saying.

Ken Cage: That is fair to say.

Steve Pomeranz: Okay, my guest is Ken Cage, celebrity repo man from Discovery Channel’s long-running show Airplane Repo . I want to get into a little bit about what it’s like to do that show, Ken. I mean, we as watchers of reality tv think it’s reality, but you’re there on the set, you’re being told to shorten your lines or lengthen your lines.

You know what’s going on day to day, you know what they’re shooting, and then when it’s all wrapped up, you’ll go and watch an episode. And I want to know how far apart the actual reality is from the reality show?

Ken Cage: That’s a great question, I’m glad you asked it. Obviously, sometimes we’re, myself—I’m the owner of the company—and the production company that’s putting the show together are opposing forces because I have to protect my company, and I have to keep things as real as we can get, and they want to tell a story.

Steve Pomeranz: Yeah, [LAUGH] right.

Ken Cage: So there’s a lot of times because of the legalities involved that we have to reproduce things. I can’t show me talking to you, as the debtor, and repo-ing your airplane. That’s against the law.

Steve Pomeranz: A real person, you can’t do that, yeah, of course.

Ken Cage: So we have to reproduce some of that stuff, and we put the disclaimers right on at the beginning.

Steve Pomeranz: These are actors and this is a-

Ken Cage: Some of the stuff is reproduced and redone and recreated and stuff like that, which is, so we try and tell people that up front. I push really hard to keep the stories as true as is humanly possible, and that’s always been my fight.

We had a second production team that did the third season, and they were really great to work with because they were able to tell a great story but also honor the fact that I owned a company, and they didn’t want to hurt that. So I didn’t have to fight as hard on that. But, yeah, there’s a lot of times, and honestly, if you look at some of the news pieces they did before the show, I’m very quiet when I’m actually repossessing.

Steve Pomeranz: Yes.

Ken Cage: Because I’m scanning, and I’m looking, and I’m listening, and I’m figuring. Then I started doing my regular thing with the reality shows, like you can’t sit quietly.

Steve Pomeranz: No.

Ken Cage: What are you thinking? What are you going through? And that was really a challenge at first, and my tagline that I’d become kind of known for when I find the airplane or the item I’m looking for, I always say, Yahtzee.

Ken Cage: Is that thing? You’ve always said Yahtzee? No, I’m sitting there looking at a plane with cameras on me, I’m like, all right let’s go, and they’re like no, you have to celebrate.

Steve Pomeranz: [LAUGH] Got it.

Ken Cage: How am I going to celebrate? And they made me sit there and come up with Yahtzee.

Steve Pomeranz: Well, you also go around with bodyguard as well. So take us out, we’ve got about a minute left, and tell us one of your most interesting stories.

Ken Cage: Well, when I first met Danny, Danny Thompson is my partner on the show, and he does repos with me off the show as well.

I first met him outside of Phoenix, Arizona on a case. Production crew put us together. I thought I was actually hiring him, but the production crew was like no, he’s for the show. He gets in the car, he’s nervous as can be because we don’t know each other, and we’re trying to drive to this repo by the airport.

All the sudden he blows through a stop sign and there’s a police officer there. So literally, 15 minutes after I meet him, he’s getting pulled over. I look at him, I’m like, do I have anything to worry about here with the police because I didn’t know anything. He looks at me and goes, not that you need to know about, and now the officer’s here, I’m like, what kind of answer is that?

So I’m freaking out. He obviously was clean as a whistle, never an infraction in his life. The officer leaves, he looks over, and he goes, you need to relax a little and then laughs at me. So he’s a great character, but he’s also a great protector because I can’t physically get involved with people, I can’t breach the peace.

But as a bodyguard, he can help me keep the debtors away from me and away from the assets, which makes my life a whole lot easier.

Steve Pomeranz: So is he a pretty big guy?

Ken Cage: Danny is about 5’10”, 5’11”, he’s huge, I think he goes 250, but he’s also the North Carolina state record holder for powerlifting, so he is a huge guy.

Steve Pomeranz: Gotcha, so his presence mitigates a lot of the possible issues that you’ll come across.

Ken Cage: He absolutely does, most people don’t want to challenge him too much, but if they start trying to get tough and loud, he basically is my offensive lineman, and he keeps everybody away, and he just says, go, and I get in the airplane and get with the pilots, and we’re clear, so he keeps everything safe for me.

Even if people want to challenge him, it doesn’t last too long because Danny knows how to handle himself.

Steve Pomeranz: You’ve been listening to the celebrity repo man from Discovery Channel’s show Airplane Repo . I’ve been talking with Ken Cage, and don’t forget if you have a question about what we just discussed, ask us, call us, or write us, or go to our website at stevepomeranz.com and ask us anything you like.

And when you’re there, sign up for our weekly update where we will send you in your inbox the weekly show, with all the segments separated and segregated, and you can read a summary, or read the transcript, or actually hear the segment itself at stevepomeranz.com. Hey, Ken, thank you so much for joining us.

Ken Cage: Steve, thank you so much for having me. I really appreciate it.

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Season 2 – Airplane Repo

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Danny Thompson

Mike Kennedy

Kevin Lacey

Steve Jones

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Airplane repo.

S2.E1 ∙ Armed on Arrival

S2.E2 ∙ Repo Rat Race

S2.E3 ∙ The Blonde Bomber

S2.E4 ∙ Panic at 10,000

S2.E5 ∙ Blood and Mud

S2.E6 ∙ Wounded Warbird

S2.E7 ∙ Flying Blind

S2.E8 ∙ Get Rich or Die Flyin'

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