AppOne, AmeriCredit Alliance Rolled Out Nationally
BATON ROUGE, La. — AppOne announced the national rollout of its strategic alliance with AmeriCredit.
The alliance offers AmeriCredit the capability of receiving credit applications from more than 1,100 independent auto dealers within AppOne's quickly growing nationwide dealer network. These dealers connect to AmeriCredit through the AppOne platform, which was designed to process loan applications for independent dealers.
The pilot program, started in October, has expanded to include 14 states: Alabama, Florida, Georgia, Louisiana, Mississippi, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee and Texas.
In addition, the program will further expand to include all 48 states within the continental United States by February 2007.
"AppOne's growing dealer base enabled AmeriCredit to gain immediate market share in the underserved independent auto dealers market," said Kyle Birch, AmeriCredit's executive vice president of Dealer Services.
"The ability to complement our existing risk management efforts through AppOne's platform provides us with an even greater opportunity to expand our independent dealer business," Birch added.
"This partnership provides our dealers with added financing alternatives, obtainable through AmeriCredit, a leading financing provider in the United States and Canada," explained Lee Domingue, AppOne's chief executive officer.
"Having access to a key financing source such as AmeriCredit allows independent auto dealers to compete more effectively against franchise owners who are moving into the used-car market space," he continued.
AppOne's services are accessed through its Web-based loan origination platform for independent auto dealers. Elements of the AppOne portal include DealerOne, a dealer underwriting system; RECON, a dealer scoring system; and DMSOne, a software management system for independent auto dealers.
More on AppOne's Services
Why should independent dealers join AppOne? Responding to this question, Domingue called his company unique, saying that once dealers are approved for AppOne, the program sends applications to lenders that meet their specific parameters.
"In other words, when a dealer is approved to do business with AppOne, they are approved to do business with all lenders on our platform that do business in their market," he explained last year to SubPrime Auto Finance News.
He said the company has a "great" process that includes a proprietary scoring system called RECON that the company has developed within the last decade.
"We gather financial, as well as experience, inventory and other information on owners as well as managing personnel within the dealerships and complete our investigation, much of which is automated, and analysis before approving each dealer," he said.
As time passes, the company said it does annual reviews of each dealer on its platform, in addition to monitoring the dealers for performance.
"We have a proven model, as our lenders tell us, our portfolio performs at par with, if not better than, their primary business," Domingue pointed out. "As to how many lenders see a consumer application, the dealers do not select the lenders. Our lenders tell us what program guidelines they are looking for and the AppOne program routes the applications accordingly."
He also said AppOne works with lenders by allowing them to see as many or as few applications as they would like, letting them set the specifications and guidance.
"AppOne currently has more than 1,000 dealers on the platform," Domingue noted. "When a lender comes onto the platform, applications and volume from our existing dealer base begin immediately."
What's the Lending Spectrum of AppOne's Platform?
At the time of the interview Domingue said AppOne had five lenders that purchase prime through subprime business, with three being national players and two regional.
"The nature of our partnership with RouteOne is that it allows AppOne to utilize the connection that RouteOne has built with its lenders," Domingue said. "Our relationship with lenders on the RouteOne platform will be separate and apart from their respective relationship with RouteOne. Currently, there are more than 100 lenders connected or in the process of connecting to RouteOne."
He said AppOne facilitates the lending process for independents by providing these dealers with technology to help complete the finance process in an easy, compliant manner. AppOne's primary goal is simply to help bring lenders to independents, Domingue added.
"We are looking for lenders that can fill more of the true subprime niche, as well as those who specialize in older-model, higher-mileage units," he told SubPrime Auto Finance News. "We want to better serve the dealers that carry that type of inventory and consumers that are in the market for those cars."
How Does AppOne Help Lenders?
When creating the platform, the company said it kept in mind that it's possible independent dealers may have a harder time staying up to speed on current regulation and compliance issues, therefore its platform was built in a way that makes it virtually impossible for a dealer to have paperwork errors or overcharge a fee, rate or produce documents outside the approval.
"Behind the dealer-facing technology is our back-end module that manages the workflow and feeds information to our database, which is constantly monitoring dealers' performance and updating RECON scores, potentially changing a dealer's status with AppOne," Domingue said. "As I mentioned earlier, we do annual reviews on the dealer profile and performance."
Domingue again referred to his company's business model as unique, explaining, "That we work for the lenders on our platform, using risk mitigation tools and processes that allow the lenders to service this virtually untapped market with the confidence of knowing that proper controls and compliance is in place. Accordingly, we are willing to talk to any lender that is interested in participating on the platform."
A Bit of History of the Company
Domingue highlighted the fact that AppOne has been in business serving independent dealers and lenders for almost a decade. First introduced as a floor-plan lender to the independent market, Domingue said managing dealer risk is a core aspect of the organization.
"The management team has more than 30 years' experience dealing with financing in the independent auto dealer arena," he noted. "AppOne has also built partnerships with aftermarket product companies that are referring their dealers to the platform.
"By integrating the product providers into the platform, the dealer is able to laser print the aftermarket paperwork, along with retail installment contracts, providing a more efficient process for the dealer and the dealer's customer," he added.
AppOne will continue to seek out lenders to join the platform, thereby enhancing AppOne's services for dealers, according to Domingue.
To learn more about the company, visit www.appone.net.