WAYNE, N.J.—A recent failed auction of three taxi medallions suggests that credit unions that make taxi medallion loans will continue to face a pothole-filled road.
A recent public auction for three medallions possessed by First Jersey Credit Union here as collateral on defaulted loans did not sell, reported Keith Leggett, the former senior vice president and senior economist at the ABA.
“For the two unrestricted medallions, two people were willing to bid $400,000 to $410,000. It is reported that First Jersey Credit Union had $700,000 to 800,000 in outstanding balance on each defaulted loan,” wrote Leggett in his Credit Union Watch Blog.
In rejecting the bids, First Jersey Credit Union thought that the taxi medallions were worth more, said Leggett.
“The credit union believed it can lease out the medallions and would be better off than selling now at discounted prices,” Leggett said.