3 Advantages of In-House Auto Financing Options for Start-up Car Dealerships
There is a growing preference for Sports Utility Vehicles (SUVs) to passenger cars in Australia today. If your used SUVs dealership is picking, then you couldn't have chosen a better time to start the business. However, Australians agree that SUVs don't come cheap when compared to passenger vehicles.
For this reason, providing a car financing option to clients is essential. Therefore, if you have been mulling over what type of financing option to offer your clients, then an in-house car financing option is worth considering. This article provides insight into the advantages of in-house auto financing -- also referred to as point-of-sale auto financing -- for start-up car dealerships.
Wider Pool of Clients
When looking for auto financing, car buyers often turn to independent financial lending institutions for a credit facility. However, auto financing facilities are usually pegged on a client's previous credit record. If your clients have a poor credit record, they will not get financed, which means lost business on your part. An in-house auto financing option guarantees credit to any person, irrespective of their credit history. Since the option doesn't restrict your car dealership to a specific pool of clients, you can attract a wider pool of clients.
Highly Modifiable
At one point or another, your clients might face financial challenges and strain their credit financing. During such times, car buyers want to renegotiate their auto financing repayment terms. While other car financing options can be renegotiated, point-of-sale auto-financing offers the best flexibility. For instance, clients can easily set their repayment terms. Besides, with point-of-sale auto-financing customers can opt to pay a lower interest rate over a stipulated duration temporarily. They can also choose to repay back the loan earlier and avoid interest expenses. Either way, an in-house auto financing option is a win for the dealership since you are guaranteed monthly payments and happy clients.
Faster Financing Processing
Apart from the higher interest rates and somewhat rigid repayment terms on most auto-financing options, clients dislike the amount of time it takes to process the credit facility. In most cases, the process goes through several approval stages. It is possible for clients to wait several weeks before getting the final approval for their car purchase financing. The delay might prompt your clients to rethink their loan application and put off their car purchase plan. With a point-of-sale auto-financing option, however, you can guarantee clients that the process will be complete within a day. It gives your customers little room to rethink their decisions.
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