Competition is tough in the sub prime lead field and dealers are coming up with better strategies and tactics in order to secure auto leads. It’s important to understand what it takes to secure a good lead and how to turn that lead into a loan. With that being said, here are a few tips for securing better auto finance leads among sub prime borrowers.
- Communicating with customers is a key step in securing a good lead. The sub prime audience may be more hesitant to apply for loans because they are used to being denied. It’s important to communicate with the customer and let them know their chances of being approved. You should base your approach off of whether they are a prime borrower or a sub prime borrower.
- Another important thing to consider is treating a subprime customer the same as a prime borrower. Buyers are considered sub prime when they have credit scores of 500 to 600 and are considered deep sub prime when they have credit scores of 300 to 500. While the initial approach may differ, they deserve to be treated friendly and respectfully as well. Sub prime customers will respond well to being treated with respect, since they may be used to being looked down upon by car loan dealers.
- Listing vehicle monthly payments and price will show sub prime borrowers how much they would need to pay every month. While some auto loan lenders may not think the sub prime audience exists in their area, they do, and it’s important to railer offerings toward them as well as prime borrowers.
- The process of approving and verifying differs among types of borrowers. Since sub prime borrowers have low credit scores, it’s important to focus on income verification to ensure they will be able to make their payments. With that in mind, income verification is critical when working with sub prime borrowers.
- Dealers and lenders should avoid turning down all sub prime borrowers. It’s important to remember that business is still business, even if the process is different and may take longer. But in the end, more money is made and the borrower is sure to be grateful that they were given a chance.
By following these few easy tips, your dealership will be sure to secure better sub prime leads and further increase your business grow.
