Monthly Payment

Subprime originators gain more market share in Q3

SCHAUMBURG, Ill. - 

As captive activity also registered gains, Experian Automotive highlighted on Wednesday that what it classifies as finance companies — institutions that don’t hold customer deposits but get most of their business from consumers with subprime and deep-subprime credit — gained a healthy amount of market share year-over-year during the third quarter.

According to the Q3 2015 State of the Automotive Finance Market report, finance company market share reached 13.34 percent in Q3, up 6.4 percent from the previous year.

Meanwhile, Experian indicated one of the biggest shifts in the automotive lending industry during Q3 was the resurgence of captive lenders — the lending companies owned by vehicle manufacturers.

In the third quarter, captive lenders financed 51.6 percent of new-vehicle loans, up from 36.8 percent in Q3 2011. This gain represents the largest market share of new-vehicle financing for captives since the recession.

Market share findings for other lending types show commercial banks still holding the largest share for new and used vehicle loans combined, at 34.7 percent.

“Captive lending has made a comeback since suffering a steep drop-off caused by declining new sales and lender-type shifts during the recession,” said Melinda Zabritski, Experian’s senior director of automotive finance.

“This is good news for manufacturers, as their captive finance companies often provide an additional source of revenue as well as a strong pipeline to credit for their dealer networks,” Zabritski continued

Experian mentioned five other interesting findings from its Q3 data, including:

• Consumers continue to rely on financing; the percentage of new vehicles financed reached an all-time high of 86.6 percent.

• The average credit score for a new vehicle loan fell to 710, the lowest since Q3 2007.

• During Q3, the average monthly payment for a new vehicle was $482, up $12 from the previous year.

• The average monthly payment for a used vehicle reached $361, an increase of $3 from a year ago.

• The average interest rate for a new vehicle hit 4.63 percent, while the average interest rate for a used vehicle reached 8.76 percent.

More leasing as contract terms lengthen

Experian has never seen this many new models roll over the curb connected to a lease.

Zabritski indicated leasing accounted for nearly 27 percent of all new-vehicle transactions in Q3, up from 24.7 percent the previous year. This level marks the highest percentage of vehicles leased since Experian began tracking the data publicly in 2006.

Findings from the report also showed that the average monthly lease payment was $398 during the quarter, up $1 from a year ago.

“As the price for a new or used vehicle continues to rise, leasing has become a more viable financing option for consumers looking to maintain an affordable monthly payment,” Zabritski said.

“While consumers can save an average of $84 per month by leasing rather than taking out a loan on a new vehicle, they should make sure leasing fits their lifestyle,” she continued. “Oftentimes there are mileage caps and other considerations that consumers should familiarize themselves with before entering into a leasing agreement.”

Rising vehicle prices also have given way to record loan amounts for new and used vehicles.

During the third quarter, the average amount financed for a new vehicle was $28,936, up $1,137 from the previous year.

The average amount financed for a used vehicle was $18,866, up $290 over the same time period.

Furthermore, Experian pointed out the gap between new and used loan amounts also has grown. On average, consumers finance $10,070 less on a used vehicle than on a new one.

Extending loan terms is another method consumers turned to in order to keep monthly payments low. During Q3, Experian determined the percentage of consumers who took out new and used vehicle loans with terms between 61 and 72 months reached all-time highs.

For new vehicles, approximately 44 percent took out 61- to 72-month loans, and more than 41 percent financed a used vehicle for the same duration.

Analysts noticed the percentage of consumers extending their loans even longer also has increased.

Loans for new vehicles extending 73 to 84 months increased 17.1 percent over the previous year, reaching a Q3 record high of 27.5 percent.

Used-vehicle loans extending in the 73- to 84-month term, however, reached an all-time high of 16.2 percent (a 12-percent increase over the previous year).

DriveItNow & GoMoto partner to enhance shopper engagement at dealership

CINCINNATI - 

DriveItNow, a provider of online pre-qualified monthly payment marketing technology, finalized a partnership this week with GoMoto, a dealership engagement solutions provider.

Executives explained DriveItNow will be integrated with GoMoto’s mobile kiosk technology to improve the shopper experience and boost sales for dealers.

GoMoto’s patent pending customer experience platform uses tablets and touch-screen computer displays to urge customers inside the dealership to explore products, services and specials, while capitalizing on sales conversion points and improving the overall performance of dealership BDCs, sales, F&I and service Departments.

DriveItNow’s patent pending pre-qualification payment quoting technology can display real monthly payments using dealers’ finance company programs and consumers’ actual credit bureau information, without the need for Social Security numbers/birthdates and adversely affecting consumer credit.

In-store shoppers can see personalized monthly finance and lease payment offers powered by DriveItNow on the GoMoto platform, which can enable them to take immediate action, translating to real-time results for dealers.

According to the most recent J.D. Power 2015 US Sales Satisfaction Index Survey, the use of technology tablets and computer displays by dealers during the sales process can substantially improve efficiency, resulting in increased customer satisfaction among new vehicle buyers. Consumer satisfaction soars when finance options are presented on a computer or tablet screen, compared to other methods, including printed materials, verbal quotes, and handwritten figures.

“We are very pleased to add GoMoto as a valued partner to deliver efficiency to the dealership sales process. Given an increasingly tech-savvy consumer, dealers that seamlessly connect consumers’ online experiences to the in-store environment will deliver superior customer satisfaction, DriveItNow president Tarry Shebesta said.

GoMoto chief executive officer Todd Marcelle added, “We are excited to announce an integrated customer experience with DriveItNow as they offer a proven engagement tool that generates more sales and profits for our dealers.

“Our integration allows dealers to increase transparency, reduce the sales transaction time, and improve the in-store experience,” Marcelle went on to say.

MakeMyDeal unveils tool powered by F&I Express

ATLANTA - 

MakeMyDeal, a Cox Automotive company that is geared to enable dealers and shoppers to negotiate a vehicle deal online, recently rolled out a new solution it’s calling F&I Connect.

The company explained this product is designed to bring the finance and insurance process “into the digital age.” Powered by F&I Express, F&I Connect can let dealers promote their F&I products and prices in a controlled online environment while giving consumers the opportunity to learn about financing and insurance program options before finalizing their deal.

“Our research shows that there is an opportunity within the current F&I process to better educate consumers about the value of F&I products, reduce the time they spend in the F&I office and improve their satisfaction with the overall buying process,” said Mike Burgiss, vice president and general manager of MakeMyDeal.

“By bringing F&I information and pricing online, we are able to give consumers a better understanding of their options, which can ultimately have positive effects for the dealership in terms of satisfaction and sales,” Burgiss continued.

A 2015 study commissioned by MakeMyDeal shows that while 84 percent of consumers believe that F&I products may have real value, 54 percent say that they prefer to simply complete their purchase and leave the dealership as quickly as possible.

The study indicates that the majority of vehicle purchasers feel that they are familiar with F&I products. However, when asked to define F&I products and services, the study reveals a significant gap in consumer understanding.

Additionally, 83 percent are interested in learning about F&I products before entering the dealership, and 63 percent would be more likely to buy F&I products if they could learn about them on their own time, before finalizing their vehicle purchase.

MakeMyDeal F&I Connect, powered by F&I Express, is designed to do just that — provide dealers with the opportunity to present their F&I products online to educate consumers about their options and ensure that they are a part of the total purchase consideration set.

“F&I Express has the largest aftermarket provider network in the industry with more continually joining,”, President and CEO of F&I Express president and chief executive officer Brian Reed said.

“Our digital platform provides dealers with instantaneous and accurate rates for aftermarket products,” Reed continued. “Powering F&I Connect allows us to bring the customer information earlier in the car buying process, resulting in more sales. It’s a win for everyone.”   

The MakeMyDeal F&I product was launched in beta with select dealers in June. Dealers who are interested in learning more should contact MakeMyDeal at (800) 309-2040.

$968 billion in open auto loans

SCHAUMBURG, Ill.  - 

Outstanding car loans hit a high point in the third quarter and have climbed more than 53 percent in the last five years, which appear to be good signs for the industry. As does the increase in car sales that has come with this rebound in auto finance.

However, Experian’s Melinda Zabritksi says, whether these rosy times continue hinges largely on consumers continuing to make their payments.

And for the most part, they have done so.

According to the State of the Automotive Finance Market report from Experian Automotive, 30-day delinquencies fell from 2.7 percent in the third quarter of 2014 to 2.5 percent in Q3 2015.

Likewise, 60-day delinquencies showed a similar decline, moving from 0.74 percent to 0.73 percent.

Overall, outstanding auto loan balances were at $968 billion in the third quarter, which Experian said was its highest level.  A year ago, total open balances were at $870 billion. The year before, $784 billion.

Perhaps most important, the Q3 2015 figure is more than 53 percent higher than the post-recession trough.

“Continued growth in the automotive finance market is a clear sign of improved consumer confidence over the past few years,” Zabritski, Experian’s senior director of automotive finance, said in the company's news release accompanying the study results.

“Since bottoming out in the recession, automotive sales have rebounded steadily, which is a good sign for consumers, automotive manufacturers, lending organizations and the overall economy. What’s critical to this success is that consumers stay on top of their payments,” she added. “If they can continue to manage their financial obligations and make timely payments, the automotive industry can continue to flourish and grow for quite some time.”

Breaking down the credit tiers of open loans

  • 20.82 percent of open loans were super prime.
  • 40.36 percent were prime.
  • 18.42 percent were nonprime.
  • 16.61 percent were subprime.
  • 3.79 percent were deep subprime.

Experian said in its news release for the study that “the distribution of open loans by risk segment remains relatively unchanged, demonstrating that the surge in outstanding automotive financing is driven by consumers across the board, not a specific segment of the market.”

The super prime category had the biggest year-over-year jump in open loan volume (up 8.34 percent), but subprime (up 7.8 percent) and nonprime (up 7.7 percent) weren’t far behind. 

4 findings from BillingTree’s 2015 payment survey

PHOENIX - 

BillingTree highlighted four main observations from its Consumer Finance Business Strategy and Technology Survey 2015; a project geared to try to understand the usage of payment technology solutions and the priorities of decision-making consumer lending professionals as well as to establish a benchmark to examine year-over-year trends as the industry navigates a shifting business and regulatory environment.

BillingTree commissioned the study, which was conducted by SourceMedia Research in August drawing on American Banker’s audience of financial services decision makers. According to the subsequent report, titled “Consumer Finance Business Strategy and Technology Survey 2015,” officials noted key observations and findings included:

1. Paper checks represent 41 percent of all U.S. loan payments, and when combined with cash payments (11 percent), more than half of all loans are paid non-electronically by consumers.

2. Fraud mitigation, data security and compliance were cited as the factors most critical to business growth by lenders.

3. E-mail is the primary communication method deployed by lenders for post loan communications followed closely by paper mail.

4. In addition, the report breaks out findings by financial institution size and offers more granular information including technology utilization, payment acceptance, communications and more.

In addition, BillingTree also re-established its Payment and Technology Spotlight webinar series, focused on informing and sharing best practice advice with financial industry professionals. The next webinar will be conducted Nov. 4 at 2 p.m. ET and will review the survey results in greater detail.

Registration for the complimentary webinar, which includes a copy of the survey results, is now open here.

“Last year's spotlight series saw record attendance, with hundreds of industry professionals attending our sessions. This should continue to rise this year, as more decision makers explore the bottom line and compliance benefits of incorporating payment technology into their business strategy,” BillingTree head of marketing Dave Yohe said.

“A growing awareness is reflected in the responses from our recent survey of lending institutions, where compliance and security ranked as top-of-mind concerns for industry professionals, with the use of payment technology continuing to close the gap on more traditional payment channels,” Yohe continued.

“This first interactive webinar in the spotlight series gives us a chance to take a deeper dive into the results and benchmark these against the concerns of attendees,” he went on to say.

BillingTree bolsters business development team

PHOENIX - 

BillingTree hired a director of new business development on Tuesday to focus on extending access to the company’s payment services and solutions to broader markets and industries, including auto finance.

Taking on this post is Greg Mallin, whose position was created to facilitate growth and demand as a staff addition reporting to vice president of sales and business development Chad Probst.

Mallin joined BillingTree from MasterCard Worldwide where he held the leadership position of vice president, strategic accounts for U.S. markets. He has also held roles at GE as manager of client development and Transamerica where he was director of retail finance.

“It’s an exciting time and terrific opportunity to be joining BillingTree as we develop and launch the Payrazr platform,” Mallin said. “I look forward to introducing Payrazr solutions and BillingTree’s services to new industries seeking omni-channel alternatives to capturing payments.”

Probst added that “We’ve already seen tremendous interest and adoption of our Payrazr solutions by current partners within ARM and auto finance,”

“Adding Greg to the team ensures the range of payment methods provided by Payrazr will be available to a broader audience, enabling companies to meet more individual consumer needs, improve customer satisfaction and drive revenue,” Probst went on to say.

Companies interested in adding BillingTree Payment Services and/or Payrazr Payment Solutions can contact Mallin at gmallin@mybillingtree.com or at (602) 443-5914.

Gap between new- & used-vehicle payments climbs beyond $100

SCHAUMBURG, Ill. - 

The gap between averages associated with new-vehicle installment contracts and used-vehicle deals continues to widen, while the total amount financed as well as stretching terms are on the rise, too.

The industry reached a point on Thursday where Experian Automotive announced that the difference between the average monthly payments for new and used vehicles reached its highest level on record.

According to the latest State of the Automotive Finance Market report, the average monthly payment for a new vehicle in the second quarter of 2015 was $483, while the used was $361 — widening the gap between the two to $122, the largest margin since Experian began publicly reporting the data in 2008.

Furthermore, analysts determined the difference between the total loan amounts for new and used vehicles also increased significantly. On average, consumers financed $28,524 for a new vehicle and $18,671 for used — a difference of $9,853.

“As the price of new vehicles continues to rise, and the gap between monthly payments for new and used vehicles widens, we see more and more consumers looking for ways to keep their vehicle payments affordable,” said Melinda Zabritski, Experian’s senior director of automotive finance.

“This could be especially true for consumers who have the financial ability to pursue a new vehicle but may have sticker shock at the rising prices and don’t want the accompanying high monthly payments,” continued Zabritski, who again will be one of the presenters during the SubPrime Forum at Used Car Week.

 Findings from the report also showed that consumers are continuing to extend their loan terms as a way to keep payments down, especially for used vehicles.

Experian indicated the percentage of used vehicles financed for 73 to 84 months increased by 14.8 percent from Q2 2014 to reach 16.1 percent — the highest percentage on record.

Additionally, analysts noticed new vehicles financed for the same term length climbed 19.7 percent from the previous year to reach 28.8 percent.

Leasing continues its popularity

During the second quarter, Experian found that consumers continued to select leasing as a popular option, as 31.4 percent of all new vehicles financed were leases, up from 30.2 percent the prior year.

According to the analysis, leasing terms also increased, with leases extending past the average of 36 months into the 37- to 48-month range increasing by 18 percent.

Moreover, Experian the average lease payment dropped $13 a month, going from $407 in Q2 2014 to $394 in Q2 2015.

“The automotive finance market continues to progress in response to consumer demand,” said Zabritski, who will be part of the collection of industry experts at Used Car Week that runs from Nov. 16-20 at the Phoenician in Scottsdale, Ariz.

“The availability of different financing options allows consumers to stretch their dollar and more easily find a vehicle that meets their budgetary needs,” she continued. “Lenders and automotive dealers also can benefit greatly from these trends by gaining insight that will enable them to take advantage of similar market opportunities in the future.”

4 other trends

Experian highlighted four other findings from its latest report, including:

• Used-vehicle financing is at an all-time high of 55.5 percent, compared with 53.8 percent the prior year.

• The total percentage of new vehicles financed in Q2 reached a record high of 85.8 percent, compared with 85 percent a year earlier.

• The average credit score for a new vehicle loan dropped two points from last year to reach 709. The average credit score for a used loan increased one point to 645 over the same time period.

• During the second quarter, the average interest rate for a new vehicle loan was 4.8 percent, up from 4.6 percent in Q2 2014. The interest rate for used-vehicle loans was 9.1 percent, up from 8.8 percent over the same time period.

GWC Warranty's 3 latest efforts to help independent stores

WILKES-BARRE, Pa. - 

GWC Warranty chief executive officer and president Rob Glander insisted the company’s bread-and-butter customers are dealer clients who are those small- to medium-sized independent dealerships that might not move as much metal as the big franchised stores but still want to be successful.

So the vehicle service contract provider has been on a quest this year in particular being that its GWC’s 20th anniversary to give these operators all the tools necessary to make presentations, enhance customer relations and leverage technology.

“Basically, we want to reinforce our brand messaging that GWC is the best in class used vehicle service contract provider, and we do it by trying to help dealers sell more cars,” Glander told SubPrime Auto Finance News during a phone conversation this summer. “We do it by giving them tools, better service, better products, better training and technology.

“This is a way of putting our money where our mouth is,” Glander continued. “We’re committed to giving them technology that’s going to make them more efficient regardless of how comfortable they are with it. It also helps them project a much more progressive image to their customers.

“New-car dealers sell an awful lot of used vehicles as well. We want our standalone independent dealers to be able to play with the same sort of confidence and professionalism that a new-car dealer has when they’re selling these vehicles. It levels the playing field,” Glander went on to say.

It’s not uncommon for salespeople at those franchised stores to be circling the showroom with an iPad in hand ready to help customers. This summer, GWC rolled out its own app for tablets so independents can do the same thing.

The company highlighted the GWC App features:

— Educational video library

— Interactive coverage selection tool

— Real-time, reactive virtual shopping cart

— Mobile rating engine with VIN scanner to create a fast, easy, user-guided experience for selling vehicle service contracts

“With any technology there are going to be early adopters who are all over things. We do encounter dealers that have tablets in their stores and they’re trying to make use of them,” Glander said. “But we do business with an awful lot of small and medium-sized dealerships across the U.S. They don’t get the training and resources from people coming into their dealerships all the time and offering the most up-to-date tools and technology.

"They’re oftentimes out there on islands by themselves. With the pace of change being what it is, these people have to figure out what they’re going to embrace and have to do it with cost in mind, too,” he added.

GWC rolled out the iPad app ahead of this year’s National Independent Automobile Dealers Association annual convention so company representative could be armed with the technology not only at the NIADA event but also when varios state associations have their gatherings, too.

“We’ve been tablet users for a long time. We’re big Apple people in here,” Glander said. “We said there’s got to be a way to get this technology out there for our dealers. We knew Apple will sell 250 million iPads so you know they’re out there. So how do you play in there? How do you get this in front of dealers in a way that makes it useful for them?”

After brainstorming for several months, GWC generated its app concept and hired a service provider to build the tool with the final step in the process taking about six weeks.

Those four primary app features are coupled with capabilities such as the customers being able to see exactly what level of VSC would do to their monthly payment as well as an eContracting portal so the whole delievery can be completed in a paperless process.

“It makes it very user friendly. It helps the dealer be more efficient and progressive regardless of their comfort level with the technology,” Glander said.

New Benefits for Elite and WealthBuilder Dealers

Along with this summer’s app rollout, GWC Warranty also introduced two new value-added benefits exclusively for its Elite and WealthBuilder Dealers — GWC Virtual Training and Covideo.

GWC’s new Virtual Training platform is an interactive online video training tool that is designed to offer helpful content for every employee in a dealership. Available content topics include:

—Compliance
—F&I processes
—Sales strategies
—GWC product information and more.

Ideal for new employee ramp-up and legacy employee refresher courses, the company also highlighted GWC Virtual Training also boasts testing and reporting functions to maximize retention and track progress. This value-added tool is being offered free of charge to both Elite and WealthBuilder dealers.

Covideo is a customized, branded video email marketing service proven to increase internet response rates by 77 percent, showroom shows by 27 percent, customer satisfaction by 10 percent and sales by 7 percent. Glander pointed out that Covideo is easy to use on any computer or mobile device and is useful for lead follow up, vehicle walk-arounds, thank you videos for buyers and more.

GWC is sharing the cost of Covideo with Elite and WealthBuilder dealers to offer the service at a discounted rate – a price exclusive only to GWC Elite and WealthBuilder dealers.

“At GWC, we help dealers sell more cars by providing products, service, technology and training to help build upon their success,” Glander said.

“In Virtual Training, we are providing a training platform that levels the playing field for many independent dealers competing with larger stores,” he continued. “With Covideo, we are offering a high-tech tool aimed at helping dealers project a more modern, progressive image to current and potential customers.”

To sign up for either of these benefits, Glander explained that GWC Elite and WealthBuilder dealers simply need to contact their GWC dealer consultant.

Online Dealer Portal Celebrates First Anniversary

While the company as a whole turns 20, GWC Warranty also had another milestone this summer as it hit the one-year anniversary of its online Dealer Portal

In one year, the GWC Warranty Dealer Portal received more than 45,000 vehicle service contract submissions, evolving from an online tool for dealers to rate and submit contracts electronically to a comprehensive Web-based platform used by more than 4,000 dealerships nationwide.

With 220,000 logins in the first year alone, Glander noted that dealers have found value in the Dealer Portal’s numerous tools and resources by implementing its flexible functionality into their business’ everyday processes.

With a new release of the Dealer Portal, its list of features now includes:

—Prioritized, rapid-response online claims adjudication for Elite and WealthBuilder Dealers

—Free access to GWC’s Virtual Training Platform: an interactive, user-friendly training resource available exclusively to Elite and WealthBuilder Dealers

—An educational video library with streaming, on-demand content designed to aid in selling a VSC

—Real-time, fully historical “contracts and applications” reporting complete with claims summaries for every contract ever submitted

—A virtual content hub where dealers can download electronic product brochures, detailed component coverage information, cost of repairs statistics and more

—Instant access to frequently used forms and documents, such as a digital sales waiver and user guides for various sales like the GWC Dealer App for iPads

—A comprehensive, up-to-the-minute snapshot of past contracts and rating sessions

—The lead-generating LogoBuilder application that quickly and seamlessly brands dealership inventory with extended protection to help build confidence earlier in the sales process

Auto finance currently 'working the way it’s supposed to'

CARY, N.C. - 

The fastest growing auto loan balances in nearly a decade and record loan dollar volumes? Check.

The lowest second-quarter 30-day delinquency rate in five years? Check.

Strong auto sales? Check.

Oh, and there’s balanced portfolio distribution amongst the credit tiers.

“The automotive loan market is working the way it’s supposed to, with loans being made, vehicles purchased and payments made on time,” said Melinda Zabritski, Experian’s senior director of automotive finance.

“The automotive loan market is gaining momentum while maintaining remarkable stability,” Zabritski added. “It’s a good sign for the economy overall.”

Experian Automotive lays out those signs in its latest State of the Automotive Finance Market report released Wednesday.

At the top of Experian’s list: the second-quarter’s $92 million year-over-year growth in total dollar volume for outstanding car loan balances  This represented the steepest climb in dollar volume since 2006, the company said.

Total loan balances were at $932 billion Q2, an all-time high, Experian said. A year ago, they were at $840 billion.

Meanwhile, the National Consumer Credit Trends Report from Equifax released Monday said the total outstanding balance on car loans and leases combined as of June was at $1.021 trillion, which beats the year-ago sum by 10.5 percent.  It says there are 73.7 million outstanding accounts, which is up 8 percent.

“Strong sales numbers in both the new-car and used-car markets, coupled with the availability of quality financing for consumers are a few of the main reasons the industry has reached the one trillion dollar mark," said Dennis Carlson, deputy chief economist at Equifax. “It clearly reflects that the improving economy has provided the impetus for consumers to replace their aging vehicles and begin to satisfy their pent-up auto demand.

Payments made on time

Looking at Experian's data, here’s another thing that make the current environment all the more impressive: the market has great stability these days when it comes to borrowers making payments.

In fact, the 30-day delinquency rate for the period was 2.32 percent, which was the best Q2 reading in five years, Experian said. A year ago, it was at 2.37 percent.

The 60-day level nudged up slightly, reaching 0.607 percent after coming in at 0.603 percent a year ago.

Not to mention, there appears to be a great deal of balance when it comes to the credit-tier distribution, Experian found.

Granted, the combined Q2 market share for subprime and deep-subprime loans climbed from 19.92 percent to 20.02 percent in the past year, but super prime’s share was up as well, growing from 20.68 percent to 20.99 percent.

“Overall, lenders are taking a balanced approach to their portfolios, with slight growth in subprime and deep subprime balanced by the uptick in loans to the super-prime risk tier,” Zabritski continued. “There really is nothing alarming about the growth seen in subprime loans, provided consumers continue to make timely payments.”

More on auto loan growth

Going back to Equifax’s data, the company said banks were seeing 10.1 percent growth in auto loan balances through June, with finance companies seeing similar patterns at 10.2-percent growth.

However, when it comes to the leasing segment, finance companies are way ahead; in fact, their leasing portfolios are seven times as big as those from the banks, Equifax found.

What’s more, the company notes that, “Finance companies are also growing originations faster than banks with 54.2 percent of all new auto accounts and 51.8 percent of dollar originations through April 2015 coming through finance companies.”

Offering additional context, Carlson noted: “The captive auto finance companies are supporting sales for the manufacturers, and dealers continue to work with independent auto finance companies to find the right loans for their customers, particularly in the non-prime space.

“This combination has led to finance companies growing slightly faster than the commercial bank segment.”

 

F&I Express launches ExpressQuote to enhance aftermarket product sales

DALLAS - 

On the heels of the roll-out of a compliance tool, F&I Express recently launched ExpressQuote, a new feature added to the company’s cloud-based solution to help F&I managers provide customers with fast, accurate quotes on aftermarket products.

The company explained ExpressQuote can connect F&I managers to product and price information from a large network of aftermarket insurance product providers. With just the vehicle’s VIN and mileage, F&I managers can access what F&I Express insisted are “100 percent accurate” aftermarket quotes, set a limited time availability on the offer and print a document to give to the customer.

F&I Express management highlighted this process can allow dealerships to engage customers in a conversation about F&I products when they are in a different department. For example, customers might be much more receptive to F&I messages when they are in the service department getting work done on their vehicle.

“F&I Managers need a fast and accurate way to quote customers, even when they aren’t in the F&I office," F&I Express chief executive officer Brian Reed said. “With ExpressQuote, F&I managers can access pricing information from multiple sources in real time.

“Today’s auto shoppers are often time pressed and will want a quick quote from the dealership,” Reed continued. “ExpressQuote helps automotive retailers meet their customers’ expectations.”

Reed added that providing more F&I information to customers earlier in the shopping process can prove to be a significant advantage to automotive retailers in the long run, as better-educated consumers are often easier to close.

“It really comes down to a customer service issue,” Reed said. “Smart automotive retailers realize they need to provide customers with answers — right now. Answering a customer inquiry quickly and efficiently can often make the difference between winning and losing a sale.”

The launch of ExpressQuote arrived not long after F&I Express unveiled a tool to watch margins for compliance.