Finding the right lender can be tough. You don't want to be stuck with a lender that will leave your customers frustrated and walking out the door.
How many times have you had a customer with a low or no credit score at your business looking to make a purchase with cash down? Now, how many times did you have to turn those customers away because you had a lender that was not willing to assist these customers? Yes, there are lenders that would approve customers looking to make a purchase with cash down but these lenders have many roadblocks. Lenders can reduce the probability of sale by:
- Requiring a higher down payment
- Increasing discount fees and
- Utilizing shorter-term loan approvals
You try everything you can to make it work for the customer by finding a co-signer or require a higher down payment. However, the requirements set by the lender may be nearly impossible to meet or, approving a customer is not worth the risk for you or the lender. In this case your potential sale may walk out the door and go to another shop. Don’t worry, you aren’t alone.
You could save the sale if you had a lender who would approve a no credit score customer that does not overstate fees or advances. Furthermore, it is in the best interest of the dealer and the lender to work together to ensure the deal is in compliance and without the possibility for fraud.
Finding the right lender to meet these needs can be frustrating. However, there are lenders out there that provide franchised and independent dealers the ability to sell vehicles to no-score customers and those with very low scores. The right lender can work with you to provide the customer with the opportunity to purchase a vehicle and a ‘second chance’ to increase their credit score. With the right lender, your no score customer with verifiable income can get 72-month term loans for vehicles that are newer than 2015 and have less than 90,000 miles! These simple interest retail installment contracts allow the customer to refinance their loans as their credit score improves.
The ability to provide financing for all types of credit customers is a great advantage for your business. Working with a lender who helps customers with low or no credit score creates a win-win situation for all involved parties. By helping a customer secure financing, you will create a positive shopping experience at your dealership giving you a sale and you will satisfy the needs of your client, creating a potential lifelong customer!
This Knowledge Base article was provided by Bronze Partner Right Direction Financial Services Holdings, LLC.