Subprime plus dealer overview june132013 (final)

Copyright Dealer Funding Partners, LLC
June, 2013 All rights reserved
“I've been lucky. Opportunities don’t come along
often. When they do, you have to grab them.”
― Audrey Hepburn
“You gotta’ pay attention to signs. When life
reaches out, it's a sin if you don't reach back....”
― Matthew Quick, The Silver Linings Playbook
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An innovative Lending Partner in the deep Subprime market
is extending you a rare opportunity …….
We are in search of select Dealer Partners in select markets.
Are you ready to seize this opportunity?
We often miss opportunity because
it's dressed in overalls and looks like work”
― Thomas A. Edison
2

Significantly increase Used
Vehicle Sales & Gross by serving
the deep Subprime market
(zero/no FICO to <=500 FICO scores)
Seize this opportunity in your market today.
It’s easy ….. and profitable!
Are you selling 20-plus units/month @ $2,000-plus in gross to this market?
If not, you are not maximizing the deep Subprime opportunity in your market!
3

Just how profitable is this segment for your store?
• Fully loaded Dealer Cost of unit (including recon): $7,000
• Selling price: $13,650
• Customer down payment (15%): $2,000
• Estimated amount financed: $12,570
• Estimated Dealer Gross on this deal (1): $2,462
• Return on Sales (ROS): 18%
• Return on Investment (ROI): 35%
• Number of deals per month in your market (2): 20
• Gross per month: $49,240
• Gross per year (3): $590,880
(1): Funded by DFP; 100% Non-recourse;
(2): Average production per store with full commitment
(3): Reinsurance opportunities are available to qualified Dealers; Please inquire
We must seize every opportunity we can to earn incremental gross!
That’s correct. There are Reinsurance
opportunities in deep Subprime!
4

Why should you commit to deep Subprime today?
1. Deep Subprime market grew 35% faster in 2012 than other auto finance markets
2. 40% of all vehicles sold in 2012 were sold to this profile customer (across all dealers)
3. Immediate access to inventory you need:
• You are already trading for & wholesaling for it ($4k to $9K)
4. Immediate access to customer base:
• Already paid to drive this customer to your store; Why turn them away? It’s your customer!
5. Immediate incremental gross:
• This customer is extremely profitable – too profitable to send to the BHPH/Independent
Serving this market is easy and you DON’T have to be a BHPH Dealer!
Why go through all those BHPH pushups, take on that liability, and then
wait months for profitability when you don’t have to?
5

Seizing the opportunity: What challenges will you face?
1. Ensuring your entire team is behind your decision
2. Securing the inventory ($4K to $9K)
3. Attracting the severely credit challenged customer (FICO <500)
4. Re-vitalizing the lost art of “Working a Deal”
5. Finding a viable Lending Partner; Most deep Subprime lenders don’t “get it”
• Subprime can therefore often be cumbersome and not as profitable as it should be
Overcoming these challenges is easier than you might think.
No worries. We are here to help you.
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Keys to overcoming the challenges and
successfully serving the deep Subprime market
1. Commitment: Starts with Dealer Principal and Management Team;
• Take the chance and make it happen!
2. Compensation plan
• Must incentivize everyone – This is “plus business”, so there is more than enough gross to go around!
3. Keep the $4K - $9K inventory you trade for and don’t wholesale it
4. Advertise for the severely challenged credit buyer
• They prefer to buy from you instead of the BHPH/Independent Dealer!
5. “Work the Deal” …… it’s a lost art!
• Interact personally with the Buyer, engage them, and structure a deal that makes sense;
• Don’t depend on a remote “credit analyst” to structure and approve a deal!
6. Partner with Dealer Funding Partners, LLC (DFP) as your lender. We “get it”.
a. Empower you to structure and approve the deal ; No rehashing improves delivery
percentages, CSI, productivity, and profitability
b. Utilize a simple, standardized and consistent funding formula that never changes
c. Assure continuity of funding to support the commitment you made to the segment
d. Innovative, “street-smart” Underwriting Criteria that makes sense
e. Consistent application of Underwriting Criteria – you can depend on us!
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How Dealer Funding Partners, LLC will support your success
1. Cost-based lender vs. Book-based lender:
• We understand the realities of today’s used vehicle (cost) market
2. STIP-based lender vs. Credit-based lender:
• Good customers/people make for good car deals at this level of credit score; “It’s all about the STIPS”.
3. No rehashing & no call-backs
• Results in improved delivery ratios, CSI, productivity, and profitability.
4. Simple, standardized funding formula that never changes:
• No variable discounts and no acquisition fees – easy to understand
5. “Work the Deal”! via our proprietary Deal Qualifying System (DQS);
• Cloud-based
• Simple, easy to use – and you control your gross!
6. Underwriting Criteria that is “street-smart” designed with the Dealer in mind
7. Continuity of funding to support your commitment to deep Subprime market segment
Most important, we pay more gross than any other lender. Period.
8

Empowering your Dealership to originate and approve:
DFP’s cloud-based Deal Qualification System (DQS)
Once you structure and approve the deal with DQS you
may print your Approval/Purchase Offer from DFP
“real-time” and deliver the customer!
No rehashing, no call-backs. No delays.
Step #1:
“Work the Deal”
by changing the
terms and data
in the yellow
cells
Step #2:
DQS determines
“real-time” if
the structure
“fits”
Step #3:
Your Gross is
calculated “real-
time” once the deal
structure meets
all criteria!
The DQS will notify
you “real-time” that
the deal is approved;
No rehashing, no
call-backs!
Curb-’em!
9

Why partner with DFP as your preferred
deep Subprime lending source?
Very simply because we “get it” …… and because we “get it”, we are indeed your
preferred Lending Partner.
1. Cost-based lending simply makes sense –
• Minimizes risk of market/wholesale cost variations that cost you money
2. Standardized funding formula never changes,
• Easy to manage for the Dealer
• Assures continuity of funding
• Consistent application of all underwriting criteria
3. Dealer is empowered to originate, underwrite, and approve all deals
• Deals can be structured and approved via DQS in literally less than one (1) minute.
4. We are your Partner, not just another Lender.
• We add value and assist you in your success
5. Most important, we pay more gross than any other lender, period.
• Reinsuring your Subprime strategy increases your net retention by 25%
• DFP is the only Lender in the country that can offer you this Reinsurance option
10

“ When you see the chance for more Gross, take it! “
11

Michael Tinberg
Chief Executive Officer
TEL 281.542.3525 (direct)
CEL 713.828.2650 (mobile)
michaelt@dfpemail.com
- or –
Visit us on the web @ www.dealerfundingpartners.com or www.subprimeplus.com
Dealer Funding Partners, LLC is the country’s most
innovative deep Subprime Lender.
We view the Subprime world differently - from the
Dealer’s perspective - and to that we attribute our
success.
If you are truly committed to serving the deep Subprime market successfully and
are interested in becoming one of our Dealer Partners, please contact :
MP3 credits: Dave Bruebeck “Unsquare Dance”
Steve Winwood “When you see a chance, Take it”
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Subprime plus dealer overview june132013 (final)

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Subprime plus dealer overview june132013 (final)