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Jared Hamilton
From: Jared Hamilton
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Bryant Gibby

Bryant Gibby Used car manager

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Funding deals

    We have been putting a huge emphasis on funding lately. We have had some changes in our F&I department recently and it has led to some big time funding issues. I think we have always done a good job getting our deals funded quickly, but I have nothing to compare it to. I actually think that we don't give ourselves enough time to get our deals funded compared to most dealerships.

 

    Our rule is that every deal needs to be funded in 14 days or less, otherwise the finance managers get penalized. The 14 days start at the actual date of purchase, not when the customer comes back in to finish up all the paperwork. There are tons of reasons as to why deals go past 14 days. The most common ones for us are: It takes a week to get the customer back to finish paperwork, the finance manager takes several days to cap the deal and get it upstairs, the accounting department takes too long to send the deal to the bank, and the bank issues a funding delay that takes a while to get resolved.

 

    Every finance guy that has ever worked here has attempted to get the owner to change that policy and allow them more time to get the deal funded. Needless to say, the owner hasn't budged. I think it is an attainable goal, but everyone needs to be on their A game all the time. I was just wondering if other stores out there have similar policies or if we really don't allow enough time. Do you guys give your finance department 14 days? 21 days? What is par for the course inside of the business? Let me know your thoughts.

Jim Bell
14 days?! You've got to turn it a lot quicker than that. If you are over 7 days, you may have some issues and you are also paying extra interest that you should have to on your floorplan. We are turning ours contracts about 3-4 days after delivery. There should be no reason that a deal should be sitting that long in an F&I office.
Mark Tewart
I don't mean to be rude but, 14 days? Do you know how much money that is costing the dealership? If any of our clients were experiencing 14 days for funding we would find the reason and fix it or suggest they fire who is responsible. Try the 1,3,5 rule. 1 day from point of sale to get a firm funding response, 3 days from point of sale to get it in and out of the F&I office and 5 days from point of sale for funding. In the current mode of funding from most banks that can and should be cut to 4 days. 14 days is not only unacceptable it's a huge hole in your bucket. Every hour that deal sits in F&I it costs money and creates problems.
Mark Tewart
I wanted to add a couple of things to my earlier comment. Each morning you should have a management save-a-deal meeting and go over every deal from the day before sold or unsold, the disposition, heat sheet (needed titles, stips, signatures etc., contracts in transit (deals not funded), all non-completed deals (F&I, back office, unfunded), disposition of trades including game plan for each, dealer trade disposition and more. Nothing falls through the cracks and you create massive urgency for everyone to get things done successfully. Every deal that has something incomplete or incorrect is assigned to a manager and becomes their responsibility that they must report back on the next day. You must have fail safe systems with checks and balances. Any dealership can increase sales by 10-20% just by having better processes, systems combined with a big increase of sense of urgency. Good luck with your processes and good selling!
Paul Arenson
Dealers using DealerTracks eContracting can be funded as quick as SAME day.
blake andreese
I agree with the responses from everyone.14 days is ridiculous. As an F&I director for a dealership that sold 400 to 500 units monthly if we were past 5 days my GM was getting the money from one of us. You said everyone would have to be on top of their game all the time. This should be a requirement, not expectation. A week for customer paperwork? You must unwind some deals every month as well. More money gone. Your dealer should tighten the reigns.1,3,5. If he allows 14 as a benchmark, you be proactive and change it. Then show him the revenue increase, the Customer service increase, and more deals that stick. Then you get to be a hero for doing what every other successful store does. Good luck.

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