Guidelines for Top Payouts
DealerGuidelines
· Copy of
the completed credit application
(including previous residence,
previous
employment, landlord info)
· Copy of
Contract including
signatures & date of sale
· Copy of
detailed pay history
(need not be computer generated, but
should include payment dates and amount)
We prefer to
see these additional documents included
·
Proof of
income (paycheck stubs, bank statements)
·
Proof of
residence (utility bill, etc)
· Copy of
drivers license
Level of
documentation of loans submitted
Will have an affect on pricing.
Minimum documentation
could result in no approval
Or maximum pricing (20% discount).
Program highlights are as follows:
· 2 year
current residency, if current is less than;
Then 2 year previous in same
community.
·
2 year
current employment, if current is less than;
Then 2 year previous in same
profession.
· $1,700
verified gross income
NO – AFDC,
SSI
(Disability, Retirement OK), IHSS (Caregivers),
Temp Agency employment.
Maximum
term 36 months with minimum
3 payments seasoning
Exception
for 42 month term with minimum
6 payments seasoning
Exception
for 48 month term with minimum
10 payment seasoning
Collateral
Age/Mileage restrictions
24 month
term or less max 150,000 miles
36 month
term max 125,000 miles
42 month
term max 100,000 miles
48 month
term max 80,000
No age
restrictions if above
mile restrictions are met
Additional
miles allowed for Honda,
Toyota, Nissan vehicles
No luxury
type vehicles
Pricing
·
Standard
discount 10% with adjustments made for minimum documentation
& program
adherence.
·
No Recourse
·
No
documentation fees
·
Funding
subject to full loan verification
·
Loan
purchase subject to client signing Challenge Financial Purchase Agreement
For your
personal notes our average discounts
are 12-13%.
Pre-approval takes 1-3 days
depending
on the numberof loans.
Final approval and funding takes
1-3 weeks
due to verification requirements.
The dealers ability to keep good records
And
have cooperative borrowers can drastically Cut down the funding time.
Hope this
helps!
All the best.
Option 2
- Pricing and terms are based on:
- Average seasonig
- Individual account payment history
- Average model year and mileage of collateral
Consider an Average Purchase
1. On average, the car was purchased for $3,500 and sold for $6,500 with $1,500 down.
2. $5,000 financed at 22% over 24 months with a payment of $259.39 a month.
3. After 3 Monthly Payments to the dealer, the net balance on the loan is $4487.55
4. Which is sold for $.78 or $3,500.29.
Multiply this times the number of cars in the pool.
1st Sale $6500.00
Down Payment $1500.00
Finance $5000.00
3 Payments $778.32
Sell the Note For $3500.29
You get $5778.61
Cost of Car $3500.00
Profit $2278.61
Sell the Note For $3500.29
You get $5778.61
Cost of Car $3500.00
Profit $2278.61
VERY COMPETITIVE PRICING
!
▪ NO RECOURSE! (1st payment default only ! )
▪ ALL MAKES, MODELS, even TMU, and SALVAGE titles!
▪ANY PAYMENT FREQUENCY
▪ SMALL POOLS WELCOME! NO MAXIMUM LIMIT !
*STANDARD DEALER PURCHASE with 2 MO.
SEASONING
(Payment must be
current - less than 15 days late)
The Key To BHPH
We specialize in
buying Auto Notes!
Are you an Auto Dealer or Finance Company that
creates auto notes, buy here pay here auto paper?
Do you
need CASH for inventory or for your business or personal
use? Sell your auto notes, to increase your CASH
flow and reduce your risk exposure.
Let us show you how
to increase your CASH flow without creating new
debt, don't wait for your customer to pay you off, Or
total your car. We can help you get the
financial flexibility needed to compete in today's auto
industry.
Underwriting and Stips
Most small used car dealers with good common sense, and a
reasonable judge of character, can operate a successful Buy Here Pay
Here ( BHPH ) operation without using underwriting criteria, or a
specific stipulation ( stip ) list.
“However”, with out underwriting
rules and a stip list, if you want to pass some of the decision
responsibility over to another person, OR, you want to handle more
volume, you’ll get in “EXPENSIVE” trouble “REAL” fast! Here’s how
successful BHPH dealers and BHPH paper buyers know what to buy, and how
much to pay.
Underwriting can be the trickiest because it is so subjective.
Here are
some guidelines.
We’ll call your investment in the customer “Cash in
Deal” or “CID”.
There are five basic areas to which you want to attach
value, time in area, time at residence, time on job, income, and down
payment commitment.
Attach a value to each of these and you will get a
chart that rewards the, long time in area, more resident stable, long
term job, high income, large down payment commitment customer with more
CID.
Stipulations (Stips) are more important than ever because of, you guessed it, identity
theft, not to mention deception. Your typical list of stips includes a
valid drivers license, valid insurance, pay stub verifying their job
(showing YTD income is best), copy of phone or cell phone bill
(verifying a phone where the customer can be reached), proof of address
(proving they live where they say they live), and of course, references
(people who might be able to tell you where they are if they skip). You
have “two” choices, collect the stips, hoping they will verify, while
“your” car drives around. “Or”, verifying in advance (recommended).
Drivers license is usually easy, your state has a web site or phone
number you can call to verify that the license is not suspended or
revoked. Insurance is easy, just call the agent, make sure they
actually paid for the policy and you are listed as the lien holder.
Read the pay stub, verify it’s the most recent and the income
matches the application. Call the employer, verify they are still
employed, job time, and if possible, income. This typically can be your
biggest deal buster!
Verify the home phone bill is for the address listed on the
customer’s application even if it’s in a different persons name. Cell
phones should be in the customer’s name.
Proof of address needs to be a utility bill, or some other mail
delivered by the postman, in the customer’s name, to the address the
customer put on his application.
For references, get family first, with addresses, and phone numbers, be persistent! Get 10 or make sure 7 numbers work.
Cash flow is equally as important! It just makes smart business sense
to have underwriting guidelines and do verifications before delivery,
it “always” costs more later, in time, and money!!
