Greg Goebel, President and CEO of DealerStrong, discusses which finance companies dealers are using the most often and their performance in each tier.

1. Who's Who Among Special
Finance Companies
What Companies Are Buying Which Customers?
DEALERSTRONG
Greg Goebel, CEO

2. • Annual review of which companies dealers are using most
often with credit tiers – significantly different in 2014
• Recap of each credit tier
• Likely different in every dealership, even within same organization
• Customer/deal characteristics of each “national” credit tier
• Breakdown of where the business falls nationally
• Averages vs. Benchmarks
• Source of our data
• Recap of the finance companies performance in each tier
Session Overview

3. 2015 Data Sampling
• Cooperative effort - DealerStrong and ProMax Unlimited
• Merged transactional deal data beginning May 2014.
• Nearly 1.5M transactions from over 700 dealers who report
sales data tied to credit scores.
• Data was scrubbed many times to validate each transaction.
• Averages and benchmark deal characteristics for each credit
tier developed (including near-prime and prime).
• Identify the most frequently and profitably financed vehicles.

4. Defining Greg Goebel’s National
Credit Tiers
Prime 681+
Near Prime 680 - 621
Tier 1 620 - 576
Tier 2 575 – 521 Special
Tier 3 520 - 476 Finance
Tier 4 475 - 100
Tier Zero 0

5. Relationship of Sales Among
Special Finance Tiers
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
SF Tier 1 SF Tier 2 SF Tier 3 SF Tier 4 Tier Zero

6. Prime 681+ Credit Scores
• Most creditworthy customers
• Credit score of 681 and above
• Lowest interest rates. Very extended terms
• New vehicle buyers – average 755 credit score
• New vehicle gross profits exclude $915 in dealer incentives.
Vehicle
Financed
% of All
Deals
Avg
Score
Avg Sales
Price Avg Miles
Amount
Financed
Total Down
Pmnt Pmnt
Avg.
Term
Veh. Gross
Profit
Total F&I
Gross Pft
Bchmark
Deal Profit
New 64.0% 773 $31,859 262 $29,149 $ 5,640 $ 438 62 $ 1,435 $1,467 $ 2,902
Used 37.0% 757 $20,182 49,932 $20,281 $ 2,400 $ 342 67 $ 2,410 $1,557 $ 3,966

7. Near Prime 621 – 680 Credit
Scores
• Some finance companies say they “act like prime
buyers, except when it comes time to pay.”
• Decent to good credit.
• High debt to income ratios.
• Highest average Total Deal Gross Profits
• New car vehicle gross profit excludes $915 average dealer incentive.
Vehicle
Type
% of All
Deals
Avg
Score
Avg Sales
Price Avg Miles
Amount
Financed
Total Down
Pmnt Pmnt
Avg.
Term
Veh. Gross
Profit
Total F&I
Gross Pft
Bchmark
Deal Profit
New 17.2% 653 $28,318 112 $29,426 $ 2,098 $ 479 66 $ 1,303 $ 2,167 $ 3,470
Used 20.5% 651 $17,427 57,520 $18,834 $ 1,195 $ 358 68 $ 2,480 $ 1,660 $ 4,140

8. SF Tier 1: 620 – 576 Credit Scores
• Cream of the ‘crap’.
• Deeper credit file.
• Good residence and job time. Fees: $0 - $200
• Good income. Req. Cash Down: $0
• No major derogatory credit.
• New car vehicle gross profit excludes $915 average dealer incentive.
Vehicle
Type
% of All
Deals
Avg
Score
Avg Sales
Price
Avg
Miles Amt Fin
Down
Pmt
Average
Payment
Avg.
Term
Veh.
Gross
Profit
F&I
Gross Pft
Bchmark
Deal
Profit
New 7.9% 600 $25,882 150 $27,112 $ 2,086 $ 500 69 $ 1,233 $ 2,652 $ 3,085
Used 13.5% 598 $16,177 57,277 $17,229 $ 1,187 $ 381 67 $ 2,298 $ 1,407 $ 3,704

9. SF Tier 2: 575 – 526 Credit Scores
• Traditional subprime buyer.
• Stable employment & income. Fees: $95 - $400
• Higher loan-to-value ratio. Req. Cash Down: $0 - $500
• Worse payment-to-income ratio.
• Decent car credit. Stable in area & at job.
• New car vehicle gross profit excludes $915 average dealer incentive.
Vehicle
Type
% of All
Deals
Avg
Score
Avg Sales
Price
Avg
Miles Amt Fin
Down
Pmt
Average
Payment
Avg.
Term
Veh.
Gross
Profit
F&I
Gross Pft
Bchmark
Deal
Profit
New 5.5% 552 $24,210 180 $24,806 $ 2,681 $ 452 69 $ 1,098 $ 1,795 $ 2,893
Used 12.8% 550 $15,689 52,779 $16,772 $ 1,292 $ 381 66 $ 2,193 $ 1,171 $ 3,364

10. SF Tier 2 Leaders
Tier 2
% of
Tier
Avg
of CB
Sale
Price Veh. GP F&I GP
Total
GP
Avg
Miles Term Paym
Santander Auto
Finance 12.4% 551 16,488 659 1,288 1,947 41,004 70 424
Capital One 11.3% 552 16,943 903 1,422 2,325 38,848 70 407
Ally Financial 10.8% 553 19,701 1,213 1,938 3,151 32,972 70 417
GMF/Americredit 9.4% 552 20,261 906 1,084 1,989 27,920 69 411
Regional
Acceptance 7.5% 549 16,601 1,155 916 2,070 31,359 69 445
Wells Fargo Dealer
Services 7.3% 550 17,833 1,521 1,214 2,735 53,172 66 368
Credit Unions 6.2% 555 15,265 1,375 1,221 2,596 62,596 64 346
CPS 5.1% 547 15,845 1,497 751 2,248 47,548 67 406
Credit Acceptance 4.9% 549 10,989 1,407 381 1,787 94,248 55 347

11. SF Tier 3 525 – 476 Credit Scores
• Tier where you earn your keep.
• Shorter job time, gaps. Verifiable but lower income.
• Fees: $500 - $1000 Required cash down: $1000+
• Some good credit – more derog. Likely prior repo or
foreclosure. LTVs 90% - 105% P-T-I 12% - 15%
• New car vehicle gross profit excludes $915 average dealer incentive.
Vehicle Type
% of All
Deals
Avg
Score
Avg Sales
Price Avg Miles
Amount
Financed
Total Down
Pmnt Pmnt
Avg.
Term
Veh. Gross
Profit
Total F&I
Gross Pft
Bchmark
Deal Profit
New 1.6% 502 $23,563 86 $23,836 $ 2,317 $ 472 71 $ 1,174 $ 1,434 $ 2,608
Used 5.3% 501 $14,622 62,725 $15,345 $ 934 $ 393 64 $ 2,157 $ 1,037 $ 3,194

12. SF Tier 3 Leaders

13. SF Tier 4: 475 – 300 Credit Scores
BIG difference New vs Used
New: huge payments Fees: $1500 - $3000
Used: BHPH “on steroids” (often shared risk)
High D-T-I and P-T-I ratios. Req. Cash Down: $1500 - $3000
Short job time, gaps &
hard to prove income. *Many exceptions (DL, stubs, repos)
New car vehicle gross profit excludes $915 average dealer incentive.
Vehicle
Type
% of All
Deals
Avg
Score
Avg Sales
Price
Avg
Miles Amt Fin
Down
Pmt
Average
Payment
Avg.
Term
Veh.
Gross
Profit
F&I
Gross Pft
Bchmark
Deal
Profit
New 0.4% 458 $24,321 105 $23,258 $ 3,934 $ 504 70 $ 1,048 $ 994 $ 2,042
Used 2.2% 453 $14,266 65,105 $14,917 $ 1,221 $ 387 62 $ 2,030 $ 933 $ 2,962

14. SF Tier 4 Leaders

15. Special Finance Zero Credit Scores
• Can be credit “ghost” or credit criminal
• Affordability (PTI) w/shorter Fees:
10% - $2500
term is key. Req. Cash
Down: 10% - $3000
• Significant equity
• In some states, non-documented aliens. Tier grew by 20%+ in 2015!
• New car vehicle gross profit excludes $915 average dealer incentive.
Vehicle
Type
% of All
Deals
Avg
Score
Avg Sales
Price
Avg
Miles Amt Fin
Down
Pmt
Average
Payment
Avg.
Term
Veh.
Gross
Profit
F&I
Gross Pft
Bchmark
Deal
Profit
New 2.9% 0 $22,917 41 $21,820 $ 4,485 $ 451 67 $ 946 $ 1,565 $ 2,511
Used 8.7% 0 $13,701 64,840 $14,213 $ 1,584 $ 338 64 $ 2,182 $ 1,028 $ 3,210

16. SF Tier Zero Leaders

17. Open Chapter 7 Bankruptcy
Company
Pct of
Niche Sale Price
Avg.
Mileage
Total
Down FE Pft.
Total
F&I Pft
Total
Pft. Term Pmnt
CPS 49.7% $17,541 49,084 $1,241 $2,836 $ 818 $3,654 67 $449
Prestige Financial 30.3% $16,605 40,957 $ 674 $2,492 $1,100 $3,592 69 $437
Tidewater 7.1% $17,790 34,026 $ 555 $2,301 $1,167 $3,467 69 $451
United Auto Credit 5.4% $11,379 115,876 $1,190 $3,959 $ 115 $4,075 45 $394
American Credit
Acceptance 2.4% $13,589 96,548 $1,791 $2,508 $ 437 $2,946 53 $389

18. Thank You. 
For More Information:
 Visit http://www.dealerstrong.com/
 Call our office @ 877-811-8107