Tag Archives: 2012

1 in 4 Auto Loans in 2012 Were Subprime

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A new study released earlier this month showed that 1 in 4 new auto loans in 2012 were obtained by consumers with subprime credit.

The findings, which were released by Experian Automotive, showed that 25.41 percent of consumers who got auto loans in 2012 had challenged credit. Meanwhile, consumers applying for auto loans for a new car on average were approved for $474 more than in 2011, and consumers applying for auto loans for a used car on average were approved for $370 more. Surprisingly, monthly payments stayed about the same for both new and used car loans.

Dealerships that are not promoting a special finance department are missing out on a huge segment of potential customers. Over a quarter of approved auto loans went to subprime credit consumers, and probably more loans could have been approved if dealerships were bringing in more subprime credit clientele. This is why Special Finance Group’s Complete Special Finance Solution is so important. We have years of experience working with dealerships, and we’ve seen our dealerships bring in hundreds of thousands of dollars in additional revenue every month and additionally strengthen their parts and service departments.

We like to use the analogy of a pie. One piece is the sales, one piece is service, one piece is parts, and one piece is special finance. In our mind, special finance is not an afterthought for a successful dealership. Without a strong special finance department, a giant piece of the pie is missing, and that dealership will never realize its full potential.

You can learn more about the Complete Special Finance Solution by going to http://www.specialfinancegroup.com. Also, be sure to connect with us by liking Special Finance Group on Facebook, following Special Finance Group on Twitter, and connecting to Special Finance Group on LinkedIn.

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NBC: Auto Industry Is “Little Engine That Could” In Recovering Economy

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Looking at America’s current economic situation, there are many industries that are still struggling for a comeback, but one industry is thriving in 2012 and is literally driving the economy.

2012 has been a good year for the auto industry. Sales are up, delinquencies are down, and auto loans are more accessible than ever. NBC’s Bottom Line praised the auto industry’s success and high sales in the United States despite the challenges facing the industry, and they dubbed the auto industry the “little engine that could” referring to the famous children’s book character. In the book, a long train of cars needs to be pulled over a mountain, and all of the big engines complain and refuse to pull it. When no one steps up, a little engine volunteers for the job, even as everyone around him says he can’t pull the train over the mountain. In the end, he beats the odds, and his mantra “I-think-I-can” turns into “I-thought-I-could.”

While praise is encouraging and can push people to work harder, it is better to be a big dog than an underdog. It is better for people to always expect great things than to be surprised when a dealership posts big profits. Do you want people to look at your dealership and think, I think they can, or do you want them to think, Of course they can? Part of becoming a “big dog” is utilizing a dealership to its fullest potential, and Special Finance Group can help a dealership realize that potential. With the Complete Special Finance Solution, a dealership can move more inventory, serve more customers, and bring in more customers to every other department including parts and service.

To learn more about Special Finance Group and the Complete Special Finance Solution, go to http://www.specialfinancegroup.com. You can also connect with Special Finance Group on Facebook, Twitter, and LinkedIn.

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2012: Year of the Subprime Auto Loan

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2012 feels like the year of the auto. Much of the news from the auto industry has revolved around sales which have continued to exceed industry expectations. American auto makers couldn’t be happier with factories staying active longer and with high-profile launches like the Dodge Dart making headlines. As the Wall Street Journal reported earlier this week, though, it is also the year of the subprime auto loan.

According to recent statistics, 25.4 percent of new auto loans went to borrowers with credit scores below 680, and 12 percent went to borrowers with scores below 620. Back in 2007, over 12 percent of auto loans were going to borrowers with scores below 620, but in 2008 and 2009, those numbers dropped and bottomed out to fewer than 8 percent of borrowers before steadily growing back to 12 percent in 2012.

This is fantastic news for dealerships that are putting time and resources into their special finance department. Having a 620 credit score or less is no longer disqualifying borrowers from getting an auto loan. Over a quarter of auto loans are going to borrowers with scores under 680, and dealerships that reach out to consumers with subprime credit will find customers that are ready to buy and able to get approved. With Special Finance Group’s Complete Special Finance Solution, dealerships can get more customers in the door and driving away with a car, whether the buyer has good credit or not.

Do you have the Complete Special Finance Solution yet? Learn more at http://www.specialfinancegroup.com, and connect with Special Finance Group on Facebook, Twitter, and LinkedIn.

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September: Game Changer for 2012 Auto Sales

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August was a strong month for auto sales, continuing the trend of upward sales that hasn’t let up in 2012. General Motors, Ford, and Chrysler all had significant bumps from August 2011 with anywhere from 10 percent to 25 percent increases in total sales. In September, however, sales strategies need to change for dealerships across the country as the new line-up rolls in and the used inventory, including the 2012 line-up, need to be moved off the lot.

September has already been called the best month to buy a used car by Time Magazine’s MoneyLand, and with high school and college students heading back to class, young drivers will be looking for an affordable first car. It is a time that dealerships have the potential to make a lot of sales on used cars, but since most dealerships will have their minds on the new car launches, they might miss out on these sales.

Here is where Special Finance Group can help and make sure a dealership makes the most of this extremely promising month. With the Complete Special Finance Solution, dealerships can move more of their used inventory without taking away time from the dealership’s other priorities. Special Finance Group’s call center is devoted to contacting potential customers, screening them based on information included on their application, and then setting up an appointment at the dealership. From there, two special finance experts will meet with these appointments, set them up with financing, and get them into a new or used car depending upon what they qualify for. Quite simply, the Complete Special Finance Solution helps dealerships move more inventory with less hassle.

Does your dealership have the Complete Special Finance Solution yet? Learn more by going to http://www.specialfinancegroup.com, and connect with us by liking Special Finance Group on Facebook, following Special Finance Group on Twitter, and checking Special Finance Group on LinkedIn.

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Credit, Auto Sales Top Last Year’s Customer Complaints

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What are the two biggest customer complaints of last year? One might guess landlord disputes, billing issues, or false advertising, but in actuality, customers’ top complaints were regarding car sales/repairs and credit/lending problems.

Car dealerships, especially those dealing with subprime auto loans, should be concerned about these complaints. After all, their day-to-day work encompasses both credit and auto sales. They are extremely vulnerable to customer complaints, even if they are doing a great job.

Why do customers complain more about car sales and credit-related issues? Well, our culture has been hardened and skeptical of car salesman, and time and again the credit reporting industry has confused consumers and punished them for not understanding their credit health. People come into a dealership with ammunition, ready to go to battle with the sales person, and if they don’t get a premium interest rate, they sometimes take it personally. Why don’t they deserve a better rate? Why can’t they get the car they want? Will they ever have the chance to rebuild their credit history?

Dealerships in the Special Finance Group network have a definite advantage over other dealerships when it comes to subprime auto loans. First, Special Finance Group dealerships don’t have to spend hours every day calling leads and trying to get customers in the door. Instead, Special Finance Group’s call center contacts those leads and schedules appointments for potential customers. From the start, the customer feels like a priority before they even step in the door. The Special Finance Group representative builds a sense of excitement for the appointment, and rather than waiting around for a salesperson to notice them, the customer can go to their scheduled appointment and get on with their day. It makes the process easier and more pleasant for the customer, and it is more likely that the customer will have a positive experience buying a car, even if they have poor credit or no credit.

Want to learn more about the Complete Special Finance Solution? Go to http://www.specialfinancegroup.com, and connect with Special Finance Group on Facebook, Twitter, and LinkedIn. You can also contact Special Finance Group by phone at 212-239-7270 or by e-mail at info@specialfinancegroup.com.

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Wall Street Journal Calls 2012 “A Green Light for Car Loans”

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Last week, one of the nation’s most trusted sources of financial news said that now is the time for car buyers to say yes and get into that new or used car.

The Wall Street Journal’s article “A Green Light for Car Loans” laid out all the reasons why there has never been a better time for consumers to buy and dealers to sell, even if the car buyer has poor credit. Most lenders have changed their auto loan standards to give consumers with poor credit the opportunity to re-establish their credit history and improve their credit score. Car buyers, including sub-prime borrowers, have returned the favor by keeping up with their payments, mainly because car repossession is easier than a home foreclosure or collecting on credit card debts. The U.S. chief executive at Toyota Motor Corp was happy with the trend, stating, “We are seeing more ‘subprime,’ which is good,” and Gary McAlister, general manager at the Fairway Ford Lincoln Subaru dealership in South Carolina, was pleased that “the credit issue has eased up.”

News stories like the Wall Street Journal’s recent piece are giving a push to consumers on the fence about buying a car, and the first place they go to look for a car or a car loan is the internet. Special Finance Group wants to help dealerships make the most of this extraordinary time by working tirelessly to match lenders with car buyers. With the Complete Special Finance Solution, dealerships in the Special Finance Group network get access to Special Finance Group’s online resources, their leads generated through internet advertising and social media outreach, and a call center full of highly trained customer service representatives whose sole task is setting up appointments for network dealerships. With Special Finance Group, dealerships can get more customers in the door and sell more cars without taking time away from the dealership or distracting the sales team from what they do best, which is selling cars.

You can learn more about the Complete Special Finance Solution here, and get the latest news and updates from Special Finance Group by liking Special Finance Group on Facebook, following Special Finance Group on Twitter, and connecting with Special Finance Group on LinkedIn.

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Subprime Loans Bring In High Profits for Car Dealerships, Low Delinquencies for Consumers

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Lenders might have shied away from customers with poor credit in recent years, but sub-prime auto loans are proving to be a great idea for American car buyers and dealerships alike.

According to Fitch Ratings, the U.S. auto loan market is continuing to thrive and improve, even as lenders are approving sub-prime credit clientele. There were less charge-offs and 30-day delinquencies in the second quarter, and overall, lenders had extremely low credit losses. Besides that, car sales have kept going up through the summer and are expected to hit their height of the year in August before plateauing in autumn. Now more than ever, dealerships can get more car buyers approved and move more of their inventory out the door, raking in massive profits.

Dealerships across the country are putting more time and money into their special finance department, but there is a downside to all of it. Unfortunately, many salespeople are spending their time calling auto loan leads and trying to get people in the door than they are actually selling cars. This is where Special Finance Group comes in. Special Finance Group supplements a dealership’s special finance department and gives the dealership more time to sell and less hassle getting people in the door. Dealerships in the Special Finance Group network have access to a call center that turns leads into car loan appointments as well as their own auto loan leads and targeted online advertising.

To learn more about Special Finance Group’s Complete Special Finance Solution, go to http://www.specialfinancegroup.com, and keep up with the latest from Special Finance Group on Facebook, Twitter, and LinkedIn.

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Why Generation Y Isn’t Buying Cars (And How to Change It)

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Once upon a time, not that long ago, young drivers couldn’t wait to get their first car. They would anxiously await their 16th birthday, hoping for a car in the driveway with a giant bow so they could throw a tantrum because it was the wrong color. Nowadays, Generation Y is turning out to be significantly less interested in cars, and it is showing in car sales numbers. In 2001, car buyers under 35 made up 24.4 percent of sales, nearly a quarter of sales. In 2010, only 9 years later, that percentage has dropped by almost half to 12.7 percent.

Why aren’t young drivers buying new cars? Some people say that young people once used cars as a form of self-expression and individuality, but other outlets like Facebook and Twitter are a cheaper way to achieve that. Others point to the rising popularity of Zipcars or other car-sharing services, and they claim that car companies don’t know how to appeal to a young generation.

All of these opinions are almost completely wrong. Facebook is not stealing away car sales. Nobody ever got to work driving a Tweet, and if someone honestly believes that young people bought cars to express themselves, their opinion isn’t exactly well-informed. Having a means of transportation is a necessity, and blaming low car sales amongst young people on social media is laughable. Car-sharing is the only factor worth taking into consideration amongst these ideas, and car-sharing is certainly not the only reason why young drivers are not buying new cars. Young people are not buying new cars for the same reason why young people are renting instead of buying an apartment or house. Generation Y is still recovering from the toxic combination of a poor job market and student loan debt, and in their minds, buying a new car is a luxury, not a necessity.

How can dealerships get past a young driver’s hesitant nature and tap into this market? The answer is simple: used cars. Used cars are more economical and will not lose their value as quickly as new vehicles. If more dealerships encouraged young car shoppers to check out their lower-cost used inventory, they would move a lot more inventory and renew an interest in young drivers to stop by a dealership in the first place. Car dealerships don’t need to do battle with Facebook or do anything out of the ordinary. Young people still need cars, and dealerships can still sell cars so long as they understand the challenges facing Generation Y.

If your dealership is looking to attract more car buyers of all ages, learn more about Special Finance Group’s Complete Special Finance Solution here. Also, you can learn more about Special Finance Group by liking Special Finance Group on Facebook, following Special Finance Group on Twitter, and following Special Finance Group on LinkedIn.

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Cell Phone Usage and How Sales Calls Could Cost You Millions

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Earlier this month, writer Brian Pasch asked the question, “Did You Budget for a 21 Million Dollar Internet Lead Expense?” It is a frightening question and an intriguing headline, and every dealership should be asking themselves, “What is this $21 million expense, and how can I avoid it?”

It all comes back to a seemingly harmless and necessary tool for any car salesperson: the cell phone. More specifically, cell phone usage policies are under scrutiny after a recent $21 million lawsuit involving a Coca Cola delivery driver who was using his cell phone while driving. A car accident occurred because the driver was distracted, and Coca Cola had a vague policy for drivers and cell phone use.

Cell phone usage, especially while driving, is no longer just a personal safety choice. This could be a liability for a car dealership’s sales team when they are on the phone constantly calling potential leads. If they feel pressured to get car buyers in the door, they will be more willing to take and make calls, even when they are driving.

This is where Special Finance Group is an essential asset to a dealership. The Complete Special Finance Solution includes access to our call center where our team of customer service representatives is constantly setting appointments for dealerships in our network. Salespeople won’t have to worry about being on the phone all the time, and they can simply focus on doing what they do best, selling cars.

To learn more about the Complete Special Finance Solution, go to http://www.specialfinancegroup.com, and get the latest from Special Finance Group by liking Special Finance Group on Facebook, following Special Finance Group on Twitter, or checking out Special Finance Group on LinkedIn.

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ABC News: Shop Loan First, Car Second

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Car shoppers looking for the best deal are getting some interesting advice from ABC News: Worry about your financing before picking out the car.

According to a recent article from ABC News, consumers with an average or less-than-average credit score will benefit from searching for an auto loan first and keeping their options open on the vehicle. Edmunds.com features editor and consumer advice expert Caroll Lachnit lent her advice to the piece and encouraged even people who had been turned down in the past to try again to get a car loan. Lachnit told ABC News, “(Even) consumers with poor credit are able to get back in the market.”

How does this news affect Special Finance Group and its network dealerships? Well, more consumers shopping for a new or used car will be looking for a dealership and lenders willing to work with them first and then thinking of the car second. Special Finance Group’s lead generator taps into these consumers, and from there, Special Finance Group’s highly-trained call center sets appointments for these customers at a network dealership. The result is that dealerships in the Special Finance Group network will all get more potential customers, bringing in thousands in additional revenue every month.

Does your dealership have the Complete Special Finance Solution yet? Learn more about it by going to http://www.specialfinancegroup.com, and get connected with Special Finance Group on Facebook, Twitter, and Linked In.

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