Case Study

The customer needed an economy car and he was ready to buy. His wife, on the other hand, wanted them to wait until they sold and paid off their other vehicle so they didn’t have two payments. Since the trade value offered wasn’t enough to satisfy the customer, the sales team came up with a creative plan to get the customer to buy.

The customer had good credit and the selling price was at wholesale book. So the sales manager added the payoff amount of their present car to the top of the original selling price so the vehicle appeared on the contract to sell for full retail value. The dealership then agreed to pay off the original loan on their second vehicle and keep their payments the same, only now they would own two cars instead of one.

The customers were very happy until after they had the contract and associated paper work reviewed by their attorney. He explained to them that everything "sounded good" but that they had nothing in writing to show that the dealership was actually going to pay off the first note. "I’ve seen this type of thing before", said the attorney, "Dealers will tell customers just about anything to inflate the price and then they’ll play dumb when you’re stuck paying for two cars."

As you can imagine, the customers were upset and began to reconsider and review everything about the deal. They cancelled the theft-etch and the service contract, and they angrily appeared at the dealership demanding a letter to show that their current vehicle would be paid off. This all could have been avoided by providing the letter up front, because the dealership had no intention of scamming the customer.

While our industry has started to move toward a more honest approach, our reputation will take more time to turn around. So be sure that when you take a creative approach to finance, you provide evidence and a clear explanation. This will build trust with the customer and help to avoid any confusion. It can also save you time, money and improve your referral business opportunities.