"Credit Scoring and The Importance of Proper Interviews" In last months issue I discussed how Fair Isaac Scores could impact potential customers. The response to this article has been overwhelming therefore I decided to expand on the topic and discuss in detail the importance of proper interviews as they relate to approval rate, funded to approved ratios, lender relationships and most importantly increased sales and above average gross profits. Most of us agree that various parts of the non-regulated business dealing with developing a credit worthiness score is unfair and very confusing. Never the less we are forced to play the hand dealt and realize that our competition must do the same. The difference I see between dealerships that are successful as opposed to the ones who are not is the managers ability to understand the rules and use interviews to their advantage. Since 1994 I have preached 3 key elements to managing a successful special finance department: Commitment, Accountability and Interviews! How do we think that a customer with less than perfect credit can obtain financing without first being interviewed to determine their credit history, reasons for previous problems, ability to pay and willingness to correct past credit mistakes? It will not happen on a regular basis because scoring models do not take into consideration the human factor that often drives credit history. Babies are not born with bad credit and teenagers do not aspire to grow up and become bad credit risk however today's society often deals good people bad hands. Divorce, medical expenses, loss of job or possibly lack of financial education and bad advise create situations were good people go thru hard times and end up with less than perfect credit ratings. Proper interviews will help determine who really is serious and who is not. Do not waste time with customers who have no desire or ability to repay loans, it only takes away from the time you can spend with decent people who appreciate what your company has to offer. Bad credit risk only serve to increase your fist payment default ratio and eventually lead to poor lender relations. Plan the interview, by that I mean take time to look for specific things from customers. Review this list to refresh your interview process: Use the S.A.W. Method: Sincerity, Ability and Willingness to pay. Ask Questions Verify all information on the application. Collect every stipp you can during the interview. Believe me the approval and funding process will be much easier. Discuss the credit file and look for positives. Have customer complete and sign explanation of previous credit form. Ask for cash! Cash is King and helps add merit to weak loans. Explain the process. Earn the customers confidence by being sincere. I have always said the 7 last words are "We've Never Done It That Way Before", if you aren't conducting proper interviews start now. If you are, take a hard look at your process and make sure you are using the interview to deliver more vehicles. Do not make the mistake others do by relying 100% on computer-generated scores that are unregulated and often incorrect. I am honored that so many speakers, trainers and writers use the material I have developed during the past 6 years even though they put their own spin on it however I am most pleased when dealers and managers contact me with success stories because they chose to not live by the 7 last words and try different approaches to insure success. Good Selling, Paul Snider President CreditIQ, Inc./VOISYS Systems Corporation Clearwater, Florida paul@getvoice.com