It is important to watch cash collections versus beginning-of-the-month outstanding total due, beginning-of-the-month number of accounts outstanding, and contractual payments dues. The most successful BHPH dealers devote a significant amount of time and energy to establishing effective policies and procedures for their collection departments. So, each customer must be viewed individually. No traditional lending institution will lend them money. Networking Twenty groups, or performance groups, provide dealers with an opportunity to analyze their businesses and compare results with other non-competing BHPH dealers from across the country. Of course, there are greater risks involved but the financial rewards can be outstanding to say the least. Plus the dealer keeps collecting weekly payments!
You also need to make the payments as convenient as possible. And the financial risk is relatively low. Employees in your collections department need to know how to handle exit interviews, and how to explain to customers that they are there to help them rebuild their credit. Two years ago, Chris Brown went looking for a way to facilitate sales, trade-ins, and financing for car buyers who prefer to shop online. The down payment is basically the amount you paid for the car thereby eliminating your financial downside. He makes profit on the front end the car and the back end the financing! Currently, we deal primarily with the same non recourse indirect lenders with no back end money made.
A slow start to the spring selling season could get pla much-needed boost this weekend. You get all your money back! Hence the name, Note Lotnot making repossessions. Every dealer agrees that the best advice is to adhere to set practices, but understand that exceptions have to be made sometimes.
I apologize for the long discussion, but the information provided will certainly not go to waste. The wholesaler buys the car and sells it to a note lot for a couple hundred dollars profit per car. Bbhph BHPH dealers also use a loan-scoring program to determine a numerical value associated with deal structure. A great way to help train them is with payment assurance devices.
Taking the BHPH Plunge
How many people will you need to run the new department? Howdy said in my best Texas accent!
The most successful BHPH dealers have a wide range of resources from which to acquire inventory. They should be autonomous in that you should only be contacted to handle exceptionally sensitive issues.
Buy Here Pay Here business model & start up advice? by David Brown | DrivingSales
I recommend starting small with just one car. Some wholesalers specialize in visiting large dealerships asking the used car plam manager if they have any note cars in the back they want to sell.
How much will you spend on reconditioning? Inventory must also be addressed in your business plan.
7 Keys to Success in the BHPH Business
Have an average inventory of 30 — 40 cars. Used Car Advertising Products.
Usually a collector can adequately work 80 to 90 delinquent accounts per month. I love the idea of having a huge amount of weekly cash flow, but it does sound incredibly stressful. Who is going businees make underwriting decisions? A written manual that outlines all policies and procedures is the key to success and fewer headaches.
The down payment bhpb basically the amount you paid for the car thereby eliminating your financial downside. One of my clients has a BHPH location that does 20 deals a month. Afford-A-Car in Ohio has a management office to manage all five of their lots, and all individuals designated as exception makers work out of that office. This status entitles a dealer to a monthly composite of operational data, continued over-the-phone consulting and the ability to continue attending ongoing training classes.
He just adds the cost to the end of the loan!
NABD released the results of its annual survey in May. As mentioned earlier, when you run out of cash, you are out of business. All you have hbph do is buy the parts! Successful BHPH dealers understand that by analyzing their business performance, comparing ideas, sharing challenges and discussing best practices with other dealers, they gain valuable input to guide and direct their business decisions.
More and more BHPH dealers are reporting great plaj in buying vehicles from private sellers. It can be dangerous! Many BHPH dealers are implementing an online payment feature to their websites to make payments easier and more convenient for customers.
Most companies will get a judgement against you? Customers you might not look at twice on a franchise lot will be your best paying customers on a BHPH lot.
When starting a BHPH department, the goal is simple: