It can be difficult to identify credit-challenged customers because they look like everyone else and, in fact, they are like everyone else. Often they are regular people who have lost their job, experienced an expensive medical problem, went through a very costly divorce, or had financial difficulties by thinking they could pay off a credit card with a credit card. Trying to instantly determine a customer's credit situation can be embarrassing and difficult for both customer and dealer. This will allow you to properly interview a prospect to uncover their ability to pay and their credit worthiness.
Primary lenders base their decisions for approvals, programs and rate factors on credit scores.
A higher credit score means easier approval and better rates and programs. In some cases, to accommodate a larger dealer, they will buy deep hoping to get a greater mix of the dealer's A paper. Today, with the captive lenders buying deep, the average dealer assumes that this is the best deal for the dealership. They may feel that this not only simplifies things, but also gives them an edge with the captive lenders. In reality this practice could be very expensive for the dealership.