Released a day after AutoData Corp. indicated April new-vehicle sales rose both sequentially and year-over-year, Black Book released results of its recent survey taking the pulse of the finance company community.
And that community is pretty upbeat about its prospects for continuing to fill portfolios. A total of 61.29 percent of finance company executives surveyed by Black Book said loan balances should climb this year.
“You never fully know what to expect when you produce a survey like this,” said Barrett Teague, vice president of Black Book Lender Solutions, which surveyed dozens of auto finance company executives in February.
“The first thing that is very encouraging is that our lenders are looking at the marketplace, and they’re very optimistic,” Teague continued during a phone conversation with SubPrime Auto Finance News. “They see a good year coming ahead for them. They feel like they’ve got a nice plan for how they will address the year. They look like they’ve gone in and made some contingency plans in case the market does plateau a little bit.
“I would say the overall lending market is quite optimistic,” he added.
There is a population that thinks sales might plateau this year. The Black Book survey found that level to be at 35.48 percent.
Black Book highlighted four other key findings from its 10-question survey, including:
• If loan balances remain flat, loan profitability is priority for majority (35.48 percent).
• Most will focus on extending terms or explore leasing if fewer loans booked in 2016.
• 38.7 percent of lenders are now conducting monthly portfolio analysis.
• 52 percent of lenders are likely or somewhat likely to look for external portfolios for purchase.
AutoData reported that the new-vehicle seasonally adjusted annual rate (SAAR) in April was 17.42 million units versus 16.75 million units in April of last year. The firm noted total industry deliveries of new models increased by 3.6 percent over last April and 5.5 percent versus March’s delivery figures.
Industrywide, AutoData determined 1,506,977 light vehicles were sold in April, up from 1,454,951 in April 2015.
“Despite continued headwinds that include failures of national retailers, wage stagnation and almost flat-line economic ‘growth,’ the auto industry continued to vault ahead in April,” said Jack Nerad, executive editorial director and executive market analyst for Kelley Blue Book.
“Low-cost loans, a burgeoning leasing market and low fuel costs all combined to convince a near-record number of consumers to buy a new car, truck or SUV during the month,” Nerad continued. “It seems that nothing short of a quick hike in interest rates or a sudden fuel crisis can stop the momentum of vehicle sales in the wake of last year’s record total.”
To work toward any kind of sales record, Teague emphasized how much finance companies are using data and analysis provided by firms such as Black Book. He defended his thinking by returning to the survey results.
“As you know, that’s a very important part to us and everyone who is in the industry providing data to lenders, dealers and the entire marketplace. The survey came back and told us that more lenders were planning on using more data refreshing portfolios more often, keeping an eye on how their portfolios perform from a delinquency standing as well as from an equity standing,” Teague said.
“We feel like lenders have reached out and are starting to use data significantly more than they used to. And of course that’s exciting because we feel like the data drives a lot of the decisions being made out there and gives lenders a great opportunity,” he continued.
While Black Book regularly converses with its client base, this survey gave a glimpse into what finance companies are saying.
“We do listen to the marketplace,” Teague said. “Without the input and hearing the needs of our lender market, Black Book is not as capable of bringing new items that will give them the strength to succeed. Without the strength of our partners out there succeeding, there’s not a lot of room for us.
“We ask questions and we want to listen to the needs and try to do everything within our power to fulfill those needs,” he went on to say.
Here are complete results of the Black Book Lender Solutions survey:
1. What do you expect to happen to loan balances in 2016?
Plateau – 35.48 percent
Decrease – 3.23 percent
Continue to increase – 61.29 percent
2. If growth in the market does not continue and loan balances remain flat or decrease, what is your biggest concern?
Market share loss – 16.13 percent
Loss of interest income – 12.90 percent
Focus only on loans that yield maximum profitability – 35.48 percent
Want to maintain market share but will book fewer loans – 19.35 percent
Other – 6.45 percent
3. What is your strategy for profitability if you book fewer loans in 2016? Check all that apply
Alter parameters of your program guidelines – 22.58 percent
Consider different geographic markets – 19.35 percent
Look for profitability by extending terms – 29.03 percent
Organic growth through marketing to current customers – 25.81 percent
Explore more alternative finance options such as leasing – 29.03 percent
4. What is your expectation for interest rates in 2016?
Low rates – 67.74 percent
Steady climb to 2008 levels – 32.26 percent
Steep drastic incline – 0.00 percent
5. What data are you leveraging currently to navigate the changing market?
Real-time data – 64.52 percent
Longer-term residual forecasting – 35.48 percent
6. How important is collateral data to you currently?
It will become more important in the next 6 months – 25.81 percent
We've already started to leverage collateral data for our portfolios – 32.26 percent
We're relying on collateral data more for residual forecasting – 22.58 percent
It’s not very important to me – 19.35 percent
7. How frequently will you do a portfolio analysis in 2016?
Weekly – 16.13 percent
Monthly – 38.71 percent
Quarterly – 35.48 percent
Annually – 9.68 percent
8. If your portfolio is shrinking, how likely is it that you will look for external portfolios to buy?
Not likely – 16.13 percent
Somewhat likely – 25.81 percent
Likely – 25.81 percent
Extremely likely – 9.68 percent
Very likely – 6.45 percent
N/A – 16.13 percent
9. How likely are you to mine your current portfolio for additional organic growth?
Not likely – 19.35 percent
Somewhat likely – 9.68 percent
Likely – 41.94 percent
Extremely likely – 16.13 percent
Very likely – 12.90 percent
10. Options you would consider for altering parameters. Check all that apply
Expanding credit eligibility criteria – 57.14 percent
Financing older model vehicles – 57.14 percent
Extend loan terms – 42.86 percent
Other – 28.57 percent
Top executives at Security National Automotive Acceptance Co. (SNAAC) highlighted how they are executing an aggressive growth plan based on a strategy to add a significant number of dealership customers throughout the United States.
To accomplish these goals, SNAAC recently bolstered its workforce with the appointment of two senior-level leaders and the addition of 11 team members, including a number of dealer development representatives (DDRs). SNAAC also launched newly designed military and civilian programs to better serve dealers and customers.
“In our industry, many companies have come and gone over the years; 30 years later, SNAAC is still one of the leading finance companies for dealerships within our market segment,” said Rich Oakes, SNAAC’s vice president of sales and marketing.
“The addition of more than 15 DDRs in targeted geographic areas will allow SNAAC to service our existing dealer base even better as well as increase our dealer footprint nationally, assisting in our growth efforts. It is an exciting time to be at SNAAC.”
Due to this growth, several DDRs were hired to serve dealers in the Southeast, Colorado, Texas, California and Hawaii. Throughout 2016, SNAAC is planning to hire an additional 11 DDRs in the following markets:
—Charlotte, N.C.
—Atlanta
—Raleigh, N.C.
—Sacramento, Calif.
—Chicago
—Jackson, Miss.
—Cincinnati
—Lexington, Ky.
—Corpus Christi, Texas
—St. Louis
—Louisville Ky.
“The ideal candidate for a DDR position is a self-starter who is competitive in nature and motivated by stretch goals,” SNAAC national sales manager Steve Miller said. “SNAAC promoted a record number of individuals in 2015. Our executive, leadership and associate teams are focused on making the company a great place to develop leadership skills and careers.”
This week, SNAAC announced some of the new executives.
The company hired William DeLong as chief information officer. DeLong most recently served as the director of IT at Ameritas Life Insurance. He previously held leadership positions at Ardor Consulting and Triple-I Systems.
SNAAC also hired David May as director of credit. May previously served as chief operations officer at FinCo Management.
The company also added 11 team members including:
• Hongbing Chen, quantitative risk analyst
• David McFarland, business systems analyst
• Craig Rauenzahn, dealer development representative
• Tania Guillot, dealer development representative
• Kevin Thomas, dealer development representative
• Brandilyn Simmons, dealer development representative
• Leilani Ellis, dealer development representative
• Michael Martinez, dealer development representative
• Nicole Raney, dealer development representative
• Lynsey Gaca, HR recruiter/generalist
• Emma Wahl, HR recruiting coordinator
“SNAAC is excited to welcome this group of talented new directors, analysts and team members to our growing workforce,” SNAAC chief executive officer Grant Skeens said. “Our talented team continues to grow, and we are continuing to hire for many positions in various departments in 2016.”
Skeens joined SNAAC last August after having served as chief operating officer at USAA Federal Savings Bank, one of the 30 largest banks in the U.S. and a provider of services to military members and their families. Prior to being named COO, he led USAA’s $12.5 billion consumer lending business.
“I believe the future is bright for SNAAC,” Skeens said. “We have significant opportunities to grow the company and our entire team. SNAAC is a fundamentally sound company with a track record of progress and innovation that started 30 years ago with our military program. Our challenge is to build on that success by bringing additional capabilities to our business that will accelerate our growth in both the military and civilian markets.”
With a 25-year career in banking, financial services and automotive finance, Skeens is quite passionate about the industry.
“I thrive on the challenge that, in our industry, every day is different. The landscape is always changing and highly competitive,” he said.
When asked about his execution plan for the company’s growth initiatives going forward, Skeens said, “Our team at SNAAC is top notch with a deep understanding and expertise in the auto finance industry. I believe we can drive SNAAC’s growth through expanded product offerings, technology innovations and by investing in our associates, managers and executives.”
The CEO emphasized that the SNAAC leadership team is focused on the future. Under the direction of a new strategic plan to expand the company’s portfolio and add new capabilities, career development openings will be created for associates and managers to take on new responsibilities.
“We promoted a record number of associates and managers in 2015 and plan to build on that foundation,” Skeens said. “This is testament to our team’s philosophy of making SNAAC a great place to develop leadership skills and careers.”
The military and civilian programs SNAAC offers were redesigned in record time and launched earlier this year. The company highlighted that the enhancements made have been well-received by dealers, and strong gains in both markets are expected this year.
Skeens added that he’s found SNAAC to be a fast-paced company that is nimble and able to move forward quickly to execute improvements at all levels of the business.
“Our culture is entrepreneurial, fast-paced and open, with room for everyone to contribute to our success,” he said. “I’m impressed by the new capabilities we’re developing to serve our dealers through technology platforms and making it easier for dealers to do business with us.”
Based on his career experience and leadership positions at large financial institutions, Skeens also shared that he’s impressed with the entire team at SNAAC. He emphasized that there are many professional opportunities for current and future SNAAC associates.
“SNAAC’s growth trajectory provides opportunities for all of us,” he said.
SpringboardAuto.com rolled out its private-party transaction financing availability this week.
With the company indicating more states in its network will be added soon, the online platform is now originating financing for buyers in Arizona, California, and Florida.
SpringboardAuto.com chief executive officer Jim Landy highlighted that it usually takes less than a minute to complete the loan application and receive a decision — offering a new level of control and simplicity to the process — all with the cost-savings associated with private party transactions.
“It used to be you needed to run all around town to save money buying a car from a private party, and if you were selling your car, cash was the only safe option,” Landy said.
“But a funny thing happened: mobile and online technology opened up the possibility for a faster, simpler, more convenient, more transparent — and more secure — financing experience for buyer and seller alike,” he continued.
SpringboardAuto.com leverages technology, data, and analytics to expedite and secure the entire financing process. Buyers benefit from real-time calculation of loan terms, tax estimation, online vehicle inspection scheduling, and the handling of all DMV documentation, while sellers find a serious buyer and receive funds instantly at loan closing.
In addition, SpringboardAuto.com is a win-win for both parties because it enables a more advantageous purchase/selling price versus a traditional dealer purchase/trade-in scenario.
“I specifically wanted a Jeep Wrangler,” said SpringboadAuto.com customer Andy Ortega of Santa Ana, California. “I researched and looked for a couple of months at different dealerships, but didn’t find what I wanted at a price that fit my budget. However, I found exactly what I wanted from a private seller — the right car at the right price.
“At first I worried that the finance part of the deal would be really difficult, but I went to SpringboardAuto.com on my laptop — and then on my smartphone — and was amazed at how fast and easy it was. I felt like I was in control of the loan process, and it was private, fast, and hassle-free,” Ortega added.
The company went on to mention its platform can save precious time for both buyer and seller as most SpringboardAuto.com loan applications can be completed in less than a minute, without even requiring a Social Security Number. Importantly, the application only triggers a ‘soft’ credit pull with no risk to the consumer’s credit. And, rather than having terms dictated to him/her, the consumer can configure loan terms to suit his/her individual needs.
Once approved and the installment contract is configured, SpringboardAuto.com handles the rest and makes a check to the seller available on-the-go as well.
“Our team of auto finance veterans have financed over a million consumers across the credit spectrum, including those with less than prime credit,” Landy said. “This segment today not only represents 45 percent of used car buyers, but also a new kind of consumer, who is ‘always-connected’ making buying decisions ‘on-the-go.’
“We focused on building a process that not only removes risk and saves time and many for both private party buyer and seller, but takes the pain out of what, to many, is an unfamiliar process,” he went on to say.
One of the hot topics at the 2016 NADA Convention was the much debated subprime bubble in relation to rising delinquency rates. Again, industry experts worked to calm everyone’s nerves about Fitch Ratings’ latest report, which brought to everyone’s attention that as of February, 60-day delinquencies had risen to 5.16 percent, the highest rate since 1996. Even so, experts have once again stated that there is no bubble and delinquency rates are rising at a healthy level in conjunction with vehicle sales.
However, with the Federal Reserve raising interest rates by 25 basis points this past December, and the expectation that rates will rise again later this year, it can be posited that lenders will tighten restrictions within the subprime space. The last thing anyone wants is for higher interest rates to coincide with rising delinquency rates, creating a perfect storm that could potentially cause that debatable bubble to pop.
As you evaluate your portfolio risk and determine the best go-forward plan to maintain your market share, consider looking at avenues outside of those traditional lending benefits commonly used by the industry, like APR. While the industry has typically competed for ground on APR, lenders, especially in the subprime space, often have their hands tied on how low they can go due to Federal Reserve rate increases and portfolio risk.
Therefore, with increased delinquency and interest rates, in the coming months it will be more difficult to differentiate your institution from the next based on APR alone. This is why it’s important for lenders to begin thinking outside of the box now. One option that benefits lenders, dealers and consumers is to use consumer protection products, such as a vehicle service contract (VSC).
With a VSC, consumers are protected from the negative financial repercussions if their vehicles experience a costly mechanical breakdown. Consumers can utilize a VSC to cover the cost of a mechanical repair with a small deductible, thus ensuring that they aren’t hit with a repair bill that could hinder their ability to make their monthly auto loan payment.
Put another way, in the event of a major mechanical breakdown, which loan makes more sense?
—Traditional loan: The customer gets hit with a $900+ repair bill and can’t pay both the bill and their auto loan payment. They then become delinquent, and late fees, recovery fees, collection costs, repossession costs, etc. accumulate.
—Loan with a VSC: The customer pays a $50 deductible for their vehicle repair and continues to make their monthly auto loan payment. The next time they are ready for another vehicle, they are that much more likely to return to a dealership that offered them valuable and relevant protection that helped save their wallet. And, having provided a strategic loan that helps increase dealership profitability, that dealership is also that much more likely to keep your lending institution top-of-mind, making you a preferred lender.
Dealerships also benefit by setting up the F&I product presentation with a description of the benefits consumers will receive with their loans. This offers F&I managers an excellent springboard into presenting upgrade options, or additional products, to further protect the consumer.
For example, with a vehicle service contract, dealers can provide customers with the option to upgrade to a combination of longer terms and increased coverage levels. The complimentary product, combined with upgrade options, turns your loan into a dealership tool to create a rewarding and productive discussion about the benefits of consumer protection products, and the value the dealership is providing.
In essence, your loan would have the potential to maximize dealership profitability through the sale of the upgrade, enhance customer satisfaction, and increase repeat and referral business.
Thus, lenders offering products like a VSC have a significant advantage to increase market share and reduce risk.
Don’t let the industry hedge you in to only using APR to differentiate your business and protect your portfolio. Pair your loans with complimentary consumer protection products like a vehicle service contract to protect your loan portfolio, increase loan volume, and make your institution the preferred lender for both dealers and consumers.
Brien Joyce is the vice president of specialty channels at EFG Companies. This commentary was originally posted on the company website. For more details, contact EFG Companies at (800) 527-1984 or through this page.
General Motors Financial continues to move away from a company that predominantly generates subprime paper.
During the first quarter when the company saw its net income rise to $164 million, representing a climb of 14 million, GM Financial president and chief executive officer Dan Berce highlighted how much more prime paper the company originated during the span that concluded on March 31.
“Our mix of credit continues to migrate towards prime,” Berce said in prepared remarks when GM Financial reported its Q1 results last week.
“In fact, for the March quarter of 2016, 68.3 percent of our originations were prime, that's up from 53.4 percent a year ago,” he continued. “I want to point out that the absolute level of our near and subprime lending is up year-over-year, but the proportion of our total is down respectively at 13.3 percent for near-prime and 18.4 percent for subprime.
“I want to point out that our finance receivables, which are considered subprime or with FICO scores less than 620 still comprised 57 percent of our total North America retail loan portfolio,” Berce went on to say. “So as we blend in more and more prime originations in the future, our credit metrics will improve over time. Recovery rates were down a bit year-over-year to 54 percent, up seasonally from December 2015. We do expect a modest deterioration in recovery rates as we go throughout 2016.”
GM Financial’s retail loan originations came in at $4.1 billion for Q1, which was equal to the year-ago figure but down on a sequential basis as the company generated $4.4 billion in the closing quarter of 2105.
The company’s outstanding balance of retail finance receivables stood at $30.3 billion as of March 31.
Likely the entire industry has seen, GM Financial’s lease activity gained steam in Q1. The company’s first-quarter operating lease originations totaled $6.8 billion, up from $5.4 billion in Q4 2015 and $3.0 billion Q1 2015.
The company indicated that its retail finance receivables standing at 31 to 60 days delinquent represented 3.1 percent of its portfolio at close of the first quarter, down from 3.4 percent a year earlier. GM Financial’s accounts more than 60 days delinquent came in at 1.4 percent of the portfolio; the same reading at the end of Q1 2015.
GM Financial noted its annualized net credit losses represented 1.9 percent of average retail finance receivables for the quarter, 1 basis point higher year-over-year.
The outstanding balance of commercial finance receivables stood at $9.2 billion, up from what GM Financial had to close 2015 ($8.4 billion) and last year’s first quarter ($7.6 billion).
The company reported that it had total available liquidity of $12.7 billion as of March 31 consisting of $2.9 billion of cash and cash equivalents, $8.4 billion of borrowing capacity on unpledged eligible assets, $0.4 billion of borrowing capacity on committed unsecured lines of credit and $1.0 billion of borrowing capacity on a Junior Subordinated Revolving Credit Facility from GM.
F&I program provider RoadVantage recently announced a new GPS anti-theft tracking system to provide greater security and safety for both dealers and their customers. RoadVantage claims it’s one of the first F&I providers to offer a GPS System coupled with a vehicle theft protection benefit.
“The RoadVantage GPS Anti-Theft System benefits both dealers and their customers,” RoadVantage chief executive officer Garret Lacour said. “It provides dynamic inventory management for dealerships while opening up new profit opportunities.
“When sold with a vehicle, benefits are passed along to customers, who can then track their vehicles in real time,” Lacour continued. “The boundary, speeding and low battery alerts are invaluable family safety features – not only for theft protection and recovery, but also for families with new drivers.”
In addition to immediate vehicle location and speed in real time, the RoadVantage GPS Anti-Theft System can provides boundary, speeding and low battery alerts. In the event of a theft, the GPS’ 24/7 support team works directly with police to provide the vehicle’s location, enabling a quicker recovery.
The GPS Anti-Theft System also includes a vehicle theft benefit, making it one of the first F&I products of its kind on the market.
Dealers can use the RoadVantage GPS System for dynamic inventory management through 24/7 vehicle location and multi-lot “geo fences.”
Through instant location and multi-lot boundary alerts, floor plan audit times are dramatically reduced. If theft occurs, dealers can provide the police with the exact location of the stolen vehicle. The RoadVantage GPS Anti-Theft System also offers an online customer login that can be embedded in the dealer’s website, strengthening customer retention.
“RoadVantage has been first to market with several F&I products, and we’ve worked hard to build a culture of innovation,” Lacour said. “With this latest announcement, RoadVantage has brought an integrated GPS solution to both dealers and consumers.”
Yes, subprime auto lending has grown in recent years. However, don’t sound the alarm bells.
This is not mortgage crisis 2.0. It’s probably not even subprime auto lending crisis 2.0.
The level of subprime auto lending is not even close to where it was in the mid-2000s, just before the financial crisis and automotive tumble at the end of the decade, according to TD Economics, an affiliate of TD Auto Finance and TD Bank.
Federal Reserve Board statistics in a TD Economics special report released Thursday show that subprime’s share of the total auto loan originations climbed as high as approximately 33 percent before the recession.
By the end of the decade, they had plummeted to the high teens, the data shows.
Subprime’s share has since climbed, but the 2015 reading shows it still a couple handfuls of percentage points where it was before the 2008 financial crisis, according to the report.
These types of loans are “well below where they were prior to the financial crisis” says TD Economics economist Dina Ignjatovic.
And the comparison to the mortgage crisis in not an apt one, she says.
“The level of subprime loans in the auto market right now is a lot lower than it was in the run-up leading up to that financial crisis, No. 1. And No. 2, the mortgage market and the auto market are completely different,” Ignjatovic said in a phone interview.
“In the mortgage market, leading up to the recession … people were getting a mortgage without having to show their proof of employment,” she continued. “It just wasn’t very prudent lending practices that were happening. There were teaser loans out there where you had a low interest rate for the first year or two, and then it jumped up. And I guess people didn’t realize their mortgage payments would go up by so much.”
Ignjatovic added: “A lot of loans, especially on new cars, you have the same payment over the life of the loan term.”
Furthermore, she points out that delinquency rates are low, and they’re also low compared to the rates from the mortgage crisis.
TD Auto Finance president and chief executive officer Andrew Stuart said in the same interview: “I think it’s also important to note that during the financial crisis, there were no auto securitizations that went bad, when compared to the mortgage space, where they were collapsing left and right.”
And even when borrowers are having difficulty paying other bills, they typically don’t miss the car payment, Ignjatovic said.
Additionally, measures have been taken to curtail financial fallout, according to the TD report.
“While riskier loans have increased — with the average credit score for new vehicles falling back to 2007 levels in the final quarter of 2015 — regulations that have been put in place since the financial crisis have likely resulted in more prudent lending practices,” the report said.
Numbers from Experian
According to Experian Automotive, the percentage of loans 30 days past due in the fourth quarter (all credit tiers, all auto lending) was 2.57 percent, compared to 2.62 percent in Q4 of 2014.
Meanwhile, 60-day delinquencies climbed from 0.72 percent to 0.77 percent, the company said in its State of the Automotive Finance Market Report released in February.
However, this is still below the percentage in Q4 2007 when it was 0.8 percent, Experian pointed out.
“It’s a matter of degree,” said Stuart, the TD Auto Finance CEO.
“The delinquency rates have not been approaching historic highs. They have gone up a little bit, but it’s a very small amount,” he said, pointing to Experian’s numbers.
In dollar terms, Experian said 60-day delinquent balances reached $6.764 billion in Q4, up from $5.417 billion a year earlier. And 30-day delinquent balances were at $23.776 billion for Q4, up from $21.095 billion.
Those figures may seem daunting, but consider them as a percentage of the total market.
The percentage of loan balances 30 days past due was 2.41 percent in Q4, compared to 2.38 percent a year earlier. Loan balances 60 days past due represented just 0.68 percent of the market, compared to 0.61 percent in Q4 2014.
“While rates in the more severe delinquency category are up, it’s important to note that the increases are modest and relatively low from a historical perspective,” Experian senior director of automotive finance Melinda Zabritski said in a news release at the time of the quarterly report.
“Also, given that we’ve seen an increase in loans to subprime and deep-subprime consumers, it’s natural to see a slight uptick,” she added. “Although not yet a cause for concern, the industry should keep an eye on this metric to see how it trends in the quarters to come.”
Dealer Marketing Services, makers of ProMax Unlimited, unveiled the second of three soft credit pull solutions powered by Equifax data.
On Monday, the company highlighted Instant Screen powered by Equifax is the latest version of its solution that can enable dealers to provide a firm offer of credit at the dealership level. Customers shopping for a vehicle or in for a service appointment can be prescreened according to finance company’s predetermined credit criteria.
ProMax indicated these offers can be made directly to customers at the dealership or delivered via direct mail.
“Our dealership customers highly value sales leads that are sourced from engaging prospects in their service lanes,” ProMax chief executive officer John Palmer said.
“Instant Screen enables us to use credit data to provide offers to customers quickly and easily,” Palmer continued. “Once auto dealerships implement Instant Screen in their process, they can’t believe they ever did without it.”
ProMax chief technology officer Darian Miller added, “The release of this new version of Instant Screen strengthens our status as an industry leader in automotive dealer soft pull credit products.”
Instant Score, the first of the three new credit solutions which was released last fall, is designed to functions as a simple plug-in to any page on a dealership’s website. Using Instant Score, visitors to a dealership’s website are able to see their Equifax credit score free of charge.
This process only requires consumers to fill out a short form and answer brief questions to authenticate their identity, but does not require the consumer’s Social Security Number. Upon completing the form and having their identity authenticated, the consumer must consent to view their Equifax credit score and be marketed to.
If consent is obtained, ProMax emphasized the dealership receives a high quality lead.
Following the release of Instant Screen, ProMax plans to release an additional soft pull solution also powered by Equifax data to complement the previously released Instant Score: Instant Auto Credit App. The three products can be deployed by automotive dealers individually or in concert.
Instant Auto Credit App powered by Equifax is meant to serve as a logical extension to Instant Score. The Instant Auto Credit App can enable dealership website visitors to go a step further and get pre-qualified for an auto loan.
Consumers who wish to be pre-qualified are required to fill out a short form and answer brief questions to authenticate their identity; in exchange applicants may receive a credit offer that includes credit limit, interest rate and term. The dealership in turn receives a high quality pre-qualified lead.
Vehicle service contract and related finance and insurance product provider GWC Warranty finalized integration this week with defi SOLUTIONS
Executives explained that GWC’s integration with defi SOLUTIONS means that auto finance companies and their dealers will be able to seamlessly process GWC vehicle service contracts through defi’s leading-edge Web-based lending system.
“Integrating with a forward-thinking company such as defi SOLUTIONS was a clear and natural fit for us at GWC Warranty,” said Rob Glander, chief executive officer and president of GWC Warranty.
“defi’s dedication to creating an affordable, scalable, easily accessible loan origination system directly aligns with GWC’s mission to provide our partners innovative technology that helps them be more efficient and progressive,” Glander continued.
The defi-GWC integration can offer finance companies more convenient and seamless access to vehicle service contracts on the same Web-based platform they are already using. By tapping into each other’s vast and growing lender networks, GWC and defi are helping innovative finance companies drive incremental cost efficiencies and business process enhancements instantly upon implementation of the defi SOLUTIONS system.
“We are glad to offer integrated pricing and programs with GWC. GWC provides targeted service programs that help our lenders keep consumers on the road, which in turn helps protect the consumer and the lender from additional losses,” said Stephanie Alsbrooks, chief executive officer and founder of defi SOLUTIONS.
Along with making a move connected with their preferred stock, Ally Financial officials opened their new office space located at 500 Woodward Ave. in downtown Detroit this week.
The building, named Ally Detroit Center, will be occupied by more than 1,500 Ally employees and third party contractors on 13 floors. The company highlighted the new space will unite Ally’s southeast Michigan-based employees in one modern and collaborative work environment that reflects the city of Detroit.
Each floor in Ally Detroit Center was designed in the style of a distinct neighborhood, with furniture, fixtures and art installations that reflect the style of each area of the city.
“Ally Detroit Center is a unique and creative space that was designed to pay homage to our long history in Detroit and inspire the collaboration and innovation that will shape our future as a part of this vibrant city,” Ally chief executive officer Jeffrey Brown said.
“We are excited about the evolution of the city, thanks in large part to the efforts of mayor Mike Duggan and Dan Gilbert. Detroit has become one of America's most vibrant cities with a strong business district, creative and innovative talent base, and a strong connection to culture and community,” Brown continued. “Ally is pleased to be a part of this city and its revitalization.”
Brown, Duggan, along with Bedrock Detroit CEO Jim Ketai and Detroit Water Ice Factory founder and author Mitch Albom joined together to officially cut the ribbon on Ally Detroit Center and welcome Ally to its new Detroit headquarters.
During the event, the names and corresponding neighborhoods of each of the 13 floors were unveiled, including:
—Foxtown
—Rivertown
—Greektown
—Lafayette Park
—Corktown
—Downtown
—Cultural Center
—Mexicantown
—Indian Village
—New Center
—Belle Isle
—Eastern Market
—Woodbridge.
The design concept was developed by Detroit-based design firm SmithGroup JJR.
New philanthropic endeavor
To further celebrate Ally’s commitment to Detroit, the company also announced a community promotion with local business Detroit Water Ice Factory called “The 313 Pledge.”
Through the pledge, Ally will donate $3.13 for every Detroit Water Ice sold through April 30. Proceeds will go to S.A.Y. Detroit, a nonprofit organization that aims to improve the lives of Detroit’s neediest citizens by providing shelter, food, medical care, volunteer efforts and education.
“We are pleased to welcome Ally and its employees to the Downtown district and excited to launch The 313 Pledge together to invite the community to join our efforts to give back to the city we all call home,” said Albom, who not only founded Detroit Water Ice Factory but also is the celebrated author of Tuesdays with Morrie.
More details about Ally Detroit Center
Built in 1993, Ally Detroit Center is known as Detroit and Michigan’s tallest office building. The skyscraper, designed by noted architects John Burgee and Philip Johnson, is a recognizable fixture in the Detroit skyline with its Flemish-inspired neo-gothic spires.
Approximately 350 Ally employees are moving into Ally Detroit Center this month. Ally expects the majority of the 1,500 team members (employees and contract professionals) to be moved in by November.
The company explained Ally’s office space is designed around a contemporary workplace ideology, promoting collaboration, adaptive mobility and informal social interaction. Approximately 18 percent of usable work area on each floor is dedicated to informal collaboration space, including a “playground” space where each of the distinct Detroit neighborhoods comes to life in murals and furnishings.
Ally added adjustable Herman Miller workstations are used throughout the office, enabling employees to sit or stand throughout the day and contributing to a healthier workplace.
Ally's redemption of all remaining Series A preferred stock
In other company news released this week, Ally also announced that it is calling for redemption the remaining 27,870,560 shares of its fixed rate/floating rate perpetual preferred stock, Series A. The shares will be redeemed at a price of $2 per share. The redemption date will be May 16.
The company recapped the final quarterly dividend payment of approximately $14.8 million, or $0.53 per share, was declared on the Series A preferred stock, and is payable to shareholders of record as of May 1. Ally indicated this dividend was declared by the board of directors on Monday and is payable on May 16.
Ally stated holders of the Series A preferred stock to be redeemed as of the record date will be entitled to receive the dividend stated above immediately prior to redemption of such shares on May 16.
“The redemption of the Series A preferred stock marks another step in Ally’s journey to drive greater efficiency in its capital structure and represents the elimination of the company's remaining legacy preferred stock,” Ally chief financial officer Christopher Halmy said.
“This redemption is a key step in our financial plans for 2016 and allows us to eliminate high cost preferred dividends as we continue to build shareholder value,” Halmy added.
Ally previously repurchased approximately $325 million of its Series A preferred stock in May of last year.
