"Successful SF Departments
As I have traveled across the country during the past 4 years setting up and training special finance departments one common dominator is present with dealers experiencing funding problems. Typically dealerships experiencing slow funding do not separate the special finance department. When dealerships combine special finance with regular F&I volume remains flat, gross profit suffers and funding problems are commonplace. Dealerships with separate departments directed by a trained professional who is held accountable for the overall success normally do not experience such problems.

Special finance is here to stay and successful dealers understand the importance of lender relations and quick funding. In order to achieve quick funding a commitment must be made to complete packages in a timely fashion in order that lenders can verify and pay quickly. This requires time and effort by one or two persons who not only understand the requirements but also have the knowledge to collect and verify stipps.
During the past month I have spent numerous hours in lender operation centers looking at incoming loan packages. Over 75% of the packages are incomplete! The 25% of complete packages always come in from the same dealers who set up systems and procedures to insure quick funding. Dealers ask "why are lenders so hard to deal with?" Lenders ask," why do dealers continue to send incomplete packages that cannot be funded?"

Dealerships spend thousands of dollars on systems; advertising, promotions and inventory with little or no regards to the ultimate goal of getting paid for the loans originated by special finance departments! Based on the current cost of capital in today's market this really makes no sense. The cost of having a trained special finance manager with an assistant to help package loans for funding in nominal compared to the problems incurred when funds are held up by lenders for incomplete packages.

Try This:
1. Maintain contracts in transit list for all special finance packages.
2. Use lenders checklist, require sign off prior to sending package.
3. Develop incentive programs for funding clerks, refer to last months article.
4. Track funding time by lenders.
5. Contact the lenders VP of Operations and request information on how you compare to like size dealers. Ask what can be done to improve the time it takes to get paid.
6. Do not accept fax copies of stipps, it is very easy to alter information on fax copies. Require customers to bring originals for your staff to review and copy.
7. Verify information and stipps that appear bogus or unrealistic.
8. DO NOT PAY ANY PERSON ON DELIVERIES UNTILL FUNDED!

Good Selling,