Lender Selector® changes F&I in ways that improve revenue for dealerships
One of Lender Selector®'s superpowers is the ability to improve close rates and revenue by changing a few simple things in the current F&I process. Since its inception, SelectFI was designed to automate small steps and remove barriers that tend to stand in the way of closing deals.
Showing customers what they can really afford early in their shopping journey brings you the right customers ready to buy the right vehicles (particularly in the credit environment we have today). Customers take control early in the process, confident they can prequalify without any impact to their credit score. When you share the payment scenarios with the customer, you can have an informed conversation about what is affordable and with what down payment and trade value. The dealership doesn't need to be the villain in financing – our Predictive Lending™ shows what lenders will approve and with what stipulations.
Your F&I team doesn't need to trust their instincts on which lenders are likely to approve customers based on their profile and terms. In fact, it’s better if they don’t. Lender Selector® reviews all of the lenders you currently use (including local banks and credit unions) to produce the top five deals based on creditor incentives, backend guidelines, downpayment, trade collateral, and best rate. Don't risk missing a deal with a lender that seemed unlikely – more options mean you're more likely to close each customer.
We in F&I tend to reach for the lenders we have come to depend on for certain types of credit profiles and LTV deals. The risk today is that lenders are moving too quickly, adapting to the paper they want and leaving us wondering how to serve customers and close deals.
These same lender transitions can also create opportunities you can't anticipate, and Lender Selector® makes sure you see them. In this example, the dealership's go-to lender for subprime credit produced the terms we see too often - a 25% interest rate and a very difficult loan payment and loan length to sell to the customer.
Behind the scenes, the disadvantage of this lender was their TransUnion requirement. The customer had over 120 points of variance in their credit scores across the three bureaus, and Lender Selector® considered other lenders that would consider Experian scores. One of the dealer's credit union lenders produced a much more attractive rate at 8.99%.
While the credit union didn't offer the margin that the dealer's typical subprime lender did, in this case... it was the difference between closing the sale and missing the deal. Lender Selector® provides dealers with more options to choose from in less time - options dealers deserve to consider for every customer.
Prime credit profile customers tend to have an understanding of the rates they should receive and the payment they should be making for the vehicle they are considering. Likewise, so do F&I professionals... and in this example, Lender Selector® gave the dealership enough options to exceed the customer's expectations after a suprising result from their go-to prime lender.
In this case, the lender responded with an approval, but not for the full value of the vehicle. The LTV exceeded what the lender had recently changed in their regulations, and our client was in a difficult situation with the customer. They both thought a $525 payment was easily achievable for the purchase. The conversation that was supposed to follow would have been very uncomfortable... but our client put Lender Selector® to work.
The result was very favorable, producing a lender that would finance the full value of the vehicle plus some backend for an undercoating the customer was interested in - all for a lower monthly payment and no down payment. And the result came in seconds - no need to chase down an alternative lender or make a desperate phone call to a lender financing supervisor.
In this scenario, our client was able to exceed the customer's expectations and exceed the revenue they might normally earn on the sale.
You can lean on SelectFI to match lenders and customers, reducing the expertise needed in lending. Your team can focus on closing and maximizing F&I profit.
SelectFI is monitoring credit decisions continuously from every lender. It detects even the finest changes in the characteristics lenders use to approve.
