No matter how great a partnership may be, it’s rare that one party gets 100% of what it wants. The same is true with lenders and dealerships. Getting a customer financed and on a powersports vehicle is a top priority for both. However, while lenders often do what they can to accommodate a dealership, dealers are looking for finance companies to buy deeper and provide more efficient ways to offer financing and insurance products.
Blake Luecke, general manager of American Motorcycle, said he wants lenders to “lower your rates, lower your down payment requirements, and buy deeper.”
Located in Bedford, Texas, American Motorcycle is an independent dealership that sells every bike make and model, although the bulk of the inventory is Harley-Davidson. Luecke previously told Powersports Finance that it was a challenge to find strong finance programs for metric motorcycles and was looking for lenders that could facilitate that.
American Motorcycles isn’t the only dealership looking for lenders to buy deeper. Freedom Powersports regional director Chase Vance says it’s a challenge to get financing for consumers with a low FICO score. “[We’re looking] for lenders to buy a little bit deeper,” Vance said. “Because right now, a lot of the main banks like Sheffield, Synchrony, Citi, if you are below a 640 to 650, it’s going to be tough” to get a good rate.
However, buying deeper isn’t the only thing that dealers want to see from lenders. Back-end products serve as a significant source of income from the F&I office, but not every lender provides a simple way to add those to a finance deal.
St. Petersburg Powersports is a franchised dealership that carries brands such as Polaris, Indian, Victory, and Triumph. As such, when St. Petersburg is trying to finance a Polaris product it frequently works with Polaris’s partner Performance Finance. Currently, much of St. Petersburg’s transactions with Performance Finance are done manually. The dealership would like a technological solution that would allow it to work with Performance Finance electronically.
“What we do with Performance Finance on every single deal is I’ll ask them for $3,000 in [back-end products] before a customer sits down,” said corporate finance manager Robert Matt. “Selling back-end products is the way [the F&I office] makes money.” Right now, outside of warranties, much of the back-end offerings are added to the contract product-by-product. “I’d like to see an automatic add to back-end products. [Performance Finance] will allow you to add Polaris or Indian warranty on the unit. But I would like to not be capped just at the warranty.”
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