As more consumers find stronger financial standings, their purchasing power increases. However, their credit scores don’t always reflect the same progress. The end result is a massive pool of subprime and deep subprime consumers ready to buy cars this tax season.
Even large lenders are relaxing their credit score requirements in order to attract the subprime market. It’s a pretty big indicator that there’s opportunity to go around, whether you’re a BHPH dealer or own a small franchise. It also shows that there’s a lot of competition out there.
So, with more car loan options available to subprime buyers, how do you increase sales and make the most of tax season?
If you’re smart and proactive, you can bring in up to 50% of your annual sales in just 8-12 weeks. That’s money in the bank or money you can reinvest in your business by adding to your inventory.
5 Steps to a Profitable Tax Season:
- You need to be able to say yes to subprime and deep subprime buyers. With technology like GPS vehicle tracking protecting your assets, the inherent risk of serving this type of buyer is drastically reduced. Without it, you lose a large pool of tax season buyers.
- Have a plan in place to secure every deal. Competition is on the rise and every customer who walks onto your lot is a golden opportunity. If your sales process is long and cumbersome, they’ll walk off the lot and you’ll be out of the sale. To make your sales process run smoothly, have GPS preinstalled on all of your vehicles to eliminate wait time for your customers.
- Don’t let things slip just because sales are on a roll. While a buyer may have money for the down, it’s important that they can also afford the payments. You want airtight underwriting guidelines from your applications to your follow-through on STIPs verifications. GoldStar’s Reference Genie can save you time by verifying work and home addresses without the time spent on the phone.
- Remember that the sale is only the beginning and that profits are only profits after they’ve been collected. Have policies in place regarding partial payments, at what point recovery becomes an option and if a GPS vehicle tracking solution should be used to support your collection efforts.
- Think outside the box. If you hadn’t heard, the PATH Act is now a federal law. That means tax refunds won’t be sent out prior to February 15th. Instead of letting the new rules delay your tax season surge, start now. Yes, now! You can get way ahead of the rule and your competition by partnering with a tax and technology professional who can estimate refunds for your buyers. Once you’ve determined the refund schedule, you can set up irregular or later payments based on when the refund will come in. Layer that with an industry trusted GPS solution provider, and you’ll have peace of mind when it comes to your bottom line.
At the end of the day, it’s all about maximizing your revenue while maintaining the peace of mind that your business and investments are safe. During Tax Season, more than ever, the opportunity is there and the time is right. Don’t let the downside of selling to subprime buyers stop you from reaping the profits!
Utilize a trusted solution like GoldStar GPS to minimize your risk with automated reference checks up front, and on the back-end, the ability to keep buyers current using in-vehicle payment reminders. Of course, you’ll also be able to find and recover assets when necessary.
Say yes to more buyers with confidence this Tax Season and maximize your potential profit. To learn more, contact us for a free demo. Let’s get your tax season started today!