Relationships do matter, especially in the F&I office. The magazine's F&I pro lays out a five-step primer to getting stronger callbacks from finance sources.
The F&I position can sometimes seem like the least appreciated role in the dealership. In fact, my previous dealership used to refer to the F&I team as the “Deal-Prevention Department.” Yes, protecting the dealer just isn’t glamorous, but most F&I pros wouldn’t want to be anywhere else in the dealership.
Maybe the reason we love what we do is because we can make more money in 20 minutes than the sales department can make in two hours. Maybe we simply thrive on getting the “impossible” done — even if nobody notices. Whatever the case is, the job of the F&I manager isn’t easy. What I have done is prepared five tips for getting stronger callbacks — advice I think speaks to the complexity of the F&I role.
1. KNOW YOUR BANK PROGRAMS
Instead of dodging your visiting bank reps, drill them on their programs. Find out what’s new, what their niche is, what differentiates them from the competition, and whether they offer great rates on high advances. You also want to know if your finance source has a strong flat program, and whether there are automatic allowances for back end. Do they buy open bankruptcies?
Many bank reps will tell you there is no look to book. “Just send me everything and see what we can do,” they’ll say. Of course, if 10 reps say this to you and you listen, you are just shot-gunning and blindly hoping your deal will get bought. That’s not a bad thing if the lender is new to your operation and you’re trying to learn its buying habits. But the only thing you’ll get by constantly shot-gunning deals is a rep asking about the 20 deals you didn’t send him or her. And that’s not going to make either of you happy.
2. KNOW WHAT IS POSSIBLE
Some finance sources give their analysts a lot of leeway, while others impose strict rules that cannot be bent. So, how much discretion and power does your analyst have? Better yet, how much power does his or her supervisor have?
I’ve never been a fan of berating buyers. That doesn’t mean I won’t hesitate to argue with my buyer if he or she has the power to give me a thumbs-up but won’t. But constantly giving your buyer hell won’t win you any favors in the long run. Remember, this isn’t a singular-transaction relationship; you’re going to be dealing with that analyst for months, maybe even years. So ask aggressively for what you can get but know when to stop.
3. BUILD SOLID RELATIONSHIPS
Relationship lending isn’t what it used to be, but it isn’t dead, either. If you have 20 lenders and send each of them one or two deals, you probably won’t get as many favors as you would if you had sent a bulk of your business to one finance source.
My recommendation is to ask your rep if you can deal primarily with one analyst, especially if the source employs buying “teams.” What you want is a go-to guy or gal who sees all the deals you submit. That way you can ask for favors based on the volume of business you send him or her. Sure, the callback might be a little higher on one “good” deal, but having a well performing portfolio of business also gives you leverage.
4. PULL AND READ THE CREDIT REPORT
It might sound like an obvious recommendation, but there are F&I managers who submit first, then pull the credit report if they don’t get the call they want. If this is your process, how do you know which source is the best to submit a deal to? How do you know if you have a “good” call?
You also need to look beyond the score, even on 800 scores. Was the customer a rockstar until a certain point? Perhaps he or she lost a job or got sick. Does the customer have a credit card with available credit? That information might be helpful if you can’t get the advance you need to include F&I products in the customer’s financing. And if you’re worried about the customer shopping your rate, all you have to do is check to see who the customer financed with in the past and look up that source’s current rates. The bureau is a tool, so use it.
5. HAVE ACCESS TO MULTIPLE CREDIT REPORTS
You don’t have to pull all three bureaus every time, but you should have access to all three. Each bureau calculates score a little differently. The information they collect on your customer may also be different. Let’s say TransUnion shows two trade lines and your lender requires a minimum of three to qualify for a program. A quick check of your customer’s Experian and Equifax reports may reveal an additional line that can help you get that call.
My last recommendation is to seek out forums and social media pages dedicated to F&I. The F&I role may be a solidary position inside the dealership, but that doesn’t mean there aren’t F&I pros out there willing to help at a moment’s notice. If you need some suggestions, feel free to e-mail me.