Finding the Right Mix, from F&I Magazine.
A minister’s lesson about having too much of a good thing turns out to be a great guide for lender selection. His Madness offers a few other tips for managing those relationships.
It’s difficult to ignore the bank reps who walk through your dealership’s doors every few weeks with a new program or fresh strategy designed to deliver more cars. But if you’re not careful, you could end up with more sources than you need. And they didn’t sign up to get more applications; they want more contracts so they can bolster their loan portfolio.
And you can bet look-to-book ratios will be monitored regularly. Hey, they have to keep tabs on the cost of doing business with your store. And the higher the number, the better you look to them. Even finance sources that promote no look-to-book ratios have certain expectations. And the more contracts you send them, the better responses you’ll get.
So what does the right lender mix look like? Well, let me answer that with a story a traveling evangelist shared with me after a recent sermon.
He had accepted a dinner invitation from one of the church families. And after enjoying a fine meal, the host brought him a slice of chocolate cake. Little did he know that he was being set up for a lesson the host wanted to impart on him.