The Lost Art of Lender Relations by:Dan Mason O ne of the most challenging, frustrating, and confusing aspects of being a finance manager can be working with their lending partners. With the ever-changing l andscape and the continued adjustments they are making, it is sometimes overwhelming and hard to keep up. Let’s shed some light on how to make this simpler. First, it is imperative to learn and know ALL your lender programs and parameters. This seems like a huge task given the large number of finance companies most dealers have access to so, study them one at a time. The key things to look at are which credit bureau they use, what score ranges are acceptable, and how these are grouped into tiers. Next thing is the maximum front-end, back-end, and total advance as a percentage of vehicle value. Then analyze which valuation book they use for pre-owned. Is it clean trade or retail? If the car is new, do they consider invoice or MSRP as the value? And of the allowable products, which are counted toward front-end ad or back-end advance? Dizzying, isn’t it? So, instead of dismissing your reps when they stop by, pull out their rate sheet and go through the programs to find out what their niche is and how to best utilize them. Second-and this is critical-start creating relationships other than business with your reps, analysts, funders, and all the supervisors. Stop the mindset that they need us more than we need them. This couldn’t be further from the truth! We are in the relationship business. Learn about them, their families, and their hobbies. Call just to say hello once in a while because you always attract more bees with honey. When you call your buyers, don’t just jump into a deal, have a conversation about them, and genuinely take an interest. This one alone will get you more deals and most times, better calls for yourself and your customers. Third, let’s talk about funding and how to get your deals to the front of the line. The first part is simple. As soon as you see your deal in the funding queue, pick up the phone and call. This should be just a friendly call that sounds like this. “ How is your day? I just wanted to give a quick call as I saw some deals hit the queue. What can I do to help get these done?” “We are in the relationship business. Learn about them, their families, and their hobbies. Call just to say hello once in a while because you always attract more bees with honey.” Being consistent in this will train the funders to put your deals first because they know that you will be calling. It is also important that after you upload or fax a missing item that you follow up within 15 minutes to ensure it was received. They want to fund deals just as bad as you do as that is how most of them are paid. And when a deal books, call your funder just to say thank you. Do this often, even if it was a squeaky clean 800 score that funded quickly. Understand that most funders only hear from dealers when something goes wrong. Put yourself in their shoes and let them know how much you appreciate them and what they do. You will make their day and they will remember you and what dealership you are from. The next time they see one of your deals, they will go out of their way to get your deal funded. Lastly, do your homework. Stop just looking at the credit score because that’s not F&I. There are plenty of customers that were 800 scores a year ago but have been impacted by the pandemic. What you should be doing with these is conducting a customer credit interview in the salesperson’s office alone with them. Bring a copy of their credit report and go through past due accounts to find out what happened. Rehashing deals is not about bullying a lender into a deal but helping the buyer make a great decision based on facts. They have great behind-the-scenes tools but sometimes need our help with the information we get. Help them help you. Treat your lenders and their staff like the dealer partners they are and remember that they’re real people under huge pressure just as you. Make a friend, create a relationship, and be a true professional. Dan Mason is the Executive Vice President for Principal Warranty Corp. 4
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