Dealer Direct continues to increase its concentration on used financing to serve what many dealers consider an underserved market, Senior Vice President Steve Wilcoxon told Powersports Finance.
About 30% of what Dealer Direct finances is used vehicles, Wilcoxon said. “That percentage has grown over the past year,” he added. “Five years ago, we were still tied to a local manufacturer of zero-turn mowers, then we started broadening our scope. If you look at us five years ago, our growth has been paramount. Through our evolution and bringing in more product lines, we’ve had a lot of fun with this program, we’ve met a lot of good people, and we’ve positioned ourselves well in the market.”
Dealer Direct — the powersports lending subsidiary of First Community Bank — funded $73 million in powersports loans in 2016, with a goal of reaching $150 million in volume for 2017. The company makes loans for more than 1,800 dealers in 48 states.
“The ability for in-store, used financing is pretty limited, which is why we continue to tell our dealers that we will finance anything that is five years or newer,” he said.
Dealer Direct offers as low as 6.99% APR for up to 60 months on used sportbikes five years or newer, and for touring and cruiser motorcycles it will finance units up to 15 years old.
“That [used financing] market is heating up,” Wilcoxon said. “There are a lot of manufacturers, and every time someone buys a new vehicle there may be an opportunity to trade. We want to make sure [dealers] have an avenue to sell those units.”
Wilcoxon’s colleague, Dealer Direct’s National Sales Director Jon Vestal, will participate in a panel entitled “Finding Loan Growth Amid Increasing Competition” at the upcoming PowerSports Finance 2017, which will take place Oct. 24-25 at the Wynn Las Vegas. Vestal and his fellow panelists will discuss discipline in the face of percolating competition, tips for managing margin compression, identifying new products and growth opportunities, and best practices for loss mitigation.
Other sessions include: Keys to Successful Subprime Lending, Opportunities in Pre-owned, F&I Dos and Don’ts, Improving Lender-Dealer Relationships, and Regulatory Compliance Update. The full agenda can be viewed here. To learn more — or to register — for PowerSports Finance 2017, click here.