Consumer Portfolio Services: Skeptics Must Be Persistent

Multiple loan rejections can cause any car buyer to give up hope that a loan can be found.  Consumer Portfolio Services wants car shoppers to know that there are financing options available.  Car dealerships must be part of the CPS dealership network to offer CPS loan programs.  Car buyers can ask the local car dealerships if they work with CPS to underwrite loans for customers.  In the subprime market, few lenders offer auto loans that fall outside the prime lending market.  Access to a subprime auto loan allows the buyer to purchase an affordable car and rebuild his credit record at the same time.

At times, the salesperson will recommend that the car buyer take some steps to improve the credit history and lengthen the time in the current job.  These recommendations are aligned with the lending criteria offered through Consumer Portfolio Services.  Approval for the auto loan is based on how long the applicant has had the same job and the amount of money earned every month.  CPS will not approve a loan for someone if the payments are not possible.  Success in repaying the loan creates a strong payment record that opens doors for future credit transactions.

Anyone who has struggled with imperfect credit knows that raising the credit score is impossible without open credit accounts.  An automobile loan is a different type of credit from a store credit card.  Combining multiple types of credit strengthens the credit history and raises the credit score.  Consumer Portfolio Services works with car dealerships to offer subprime auto loans for the purchase of cars, minivans and light trucks.  Car buyers know that buying a car is necessary for transportation to work and to conduct many of life’s activities.  Loan approval is possible for those with steady employment.

Consumer Portfolio Services: Training Dealers to Succeed

Car dealerships know that car sales must happen at a steady rate every month of the year.  Consumer Portfolio Services has many programs that are designed to maximize the success each member dealer experiences.  In 2008, traditional lending criteria shifted to exclude anyone with imperfect credit.  Consumers had trouble finding a dealership with access to subprime auto financing options.  Subprime auto loans are essential since most people fall outside the prime lending criteria.  Salespeople know that many people visit the dealership, but cannot qualify for an auto loan.  Finding qualified buyers reduces the amount of time spent attempting to sell cars to people who cannot qualify for financing.

The CPS online loan application is the primary avenue through which the salespeople will interact with CPS.  Accurate information will enhance the applicant’s experience with the dealership.  Prompt responses are possible since more than 97 percent of all loan applications are processed through the automated decision engine.  Consumer Portfolio Services offers training for the sales managers who work with the salespeople.  Accuracy in the monthly income and length of employment cannot be overemphasized.  Loan criteria do not include demographic information, such as race, age or gender.  Fairness in lending is essential to CPS and the car dealership.

CPS has designed a Direct Mail program that requires training to optimize the effectiveness of each campaign.  Sales managers are encouraged to participate in training where Consumer Portfolio Services offers guidance for each phase of the program.  Response rates are difficult to change.  Postcard recipients may contact the dealership.  The sales manager is wise to focus energy on training the sales staff to improve the closure rate.  Skeptical postcard recipients can be transformed into car buyers when the staff handles each one with care.  Results from the CPS programs will improve when the entire staff is trained in proven techniques.

Consumer Portfolio Services: Improve the Approval Process

The online application is completed when the salesperson feels that sufficient information has been gathered.  Consumer Portfolio Services has stringent requirements for the monthly income, length of employment and vehicle price.  All of the factors must work together to create an affordable loan for the car buyer.  The automated approval engine will process more than 90 percent of all completed applications in a matter of minutes.  Sales personnel will receive a returned application if the information is incomplete or inaccurate.  All information is validated against external databases.  Inaccurate information is the primary reason that an application is returned to the salesperson.

At times, the salesperson will complete the entire application, but the applicant does not fall within the loan approval criteria.  Consumer Portfolio Services has a team of loan specialists who are ready to help.  Some instances allow CPS to offer a loan that would otherwise be denied.  Most consumers want the opportunity to demonstrate the ability to repay the auto loan.  There are exceptions made when the applicant is able to afford the payments, but might have a new job.  Salespeople are asked to provide sufficient information during the phone conversation to support the case.

Consumer Portfolio Services strives to offer affordable loans in every situation.  Salespeople should have an idea about the loan payments required for each automobile price.  Understanding the thresholds of affordability will allow the salesperson to provide valuable guidance for the car shopper.  Disappointment can be avoided when the salesperson guides the shopper to the pre-owned section of the lot.  Most of the auto loans offered through CPS apply to pre-owned vehicles that fall within affordable price range.  Subprime lending has strict criteria that creates a foundation for successful repayment of the auto loan.  Salespeople are wise to match the criteria on each loan.


Consumer Portfolio Services: Are Leads Programs Effective?

Sales managers at CPS member dealerships realize that leads programs vary in return on investment.  Consumer Portfolio Services has studied the program as dealers have used the leads list, which is generated by Experian, the credit bureau.  Response rates will be somewhere between one and two percent.  The sales staff determines how many respondents become car buyers.  Postcard recipients will be skeptical because of the shower of postcards received from area car dealerships.  In most cases, a visit to a showroom reveals that the other dealerships are not offering access to subprime credit.  Disappointment increases as the consumer continues to look for an auto loan.

Participating in the Direct Mail program requires:


  • An inventory of affordable pre-owned vehicles
  • A trained sales staff that has been through some role plays before sending the postcards
  • Sufficient staff to handle a high volume of car shoppers on the same day

Each member of the staff must be prepared to answer questions posed by the postcard recipients when they call or visit the dealership.  Consumer Portfolio Services reminds the sales manager to include the receptionist in the training sessions.  Positive comments about the postcards will increase the percentage of recipients that become buyers.  All salespeople must remember the potential for additional car sales when speaking with a postcard recipient.  Some people will bring a friend or family member who falls within the loan criteria and wants to buy a car.

Completion of the CPS online loan application is a great way to prove the existence of an offer of credit.  The postcard recipient will remain skeptical until a preapproved loan is revealed.  Consumer Portfolio Services encourages sales people to determine if finding the right car should precede or follow the loan approval process. Salespeople with the ability to read the customer will devise the right approach in each situation.


Consumer Portfolio Services: Proven Results from the Direct Mail Campaign

Consumers with imperfect credit know that a shower of postcards arrives from car dealerships.  Consumer Portfolio Services has designed marketing postcards that stand out from the rest.  Information on the cards is more informative and less flashy.  The purpose of the card is to create belief in the credit offer the card displays.  Fewer consumers will receive a CPS postcard through the direct mail program, but the results are remarkable.  Dealers in the CPS network participate in the Direct Mail program to increase monthly sales.  Finding qualified consumers who are interested in buying a car is possible through the CPS method.

Experian, the credit bureau, creates the list of valid addresses.  Each consumer on the list falls within the qualifying criteria of a CPS subprime auto loan program.  Prequalifying the leads reduces the volume of postcards and improves the quality of the leads.  Consumer Portfolio Services trains the sales managers to optimize the response from the postcard recipients.  Careful handling of the people who visit the dealership will ensure that interest is retained.  Every member of the staff plays an important role in retaining the belief in the credit offer on the postcard.  Casual comments that arouse suspicion will cause the curious person to leave.

Salespeople with prior experience in the CPS Direct Mail program have shared success stories.  More than once, a car shopper will tell friends and family members about the dealership’s access to subprime auto loans.  Consumer Portfolio Services has a loan program for almost every credit situation that falls outside of the prime lending criteria.  These programs are matched with the vehicle price, monthly income and length of employment.  Affordable loans offer the consumer an opportunity to build a positive payment record.  Future access to credit can be established on this firm foundation.


Consumer Portfolio Services: Non-Franchised Dealers

The dealer network at Consumer Portfolio Services continues to expand as more dealers realize the importance of having access to subprime lending programs.  Recent changes to the traditional lending market have caused most consumers to fall outside the prime lending market.  Automobile sales are dependent on access to auto loans.  A non-franchised car dealer can qualify to be a member dealership if the following statements are true.

•           At least two years in business

•           Possess a facility and inventory in compliance with CPS requirements

These documents must be provided:

•           Three months of current bank statements

•           Current financial statement

•           Copy of current DMV driver’s license

•           Current dealership photos

•           Majority owner personal guarantee of titles

•           Satisfactory credit history for each owner

Qualifying as a non-franchised dealership in the CPS dealer network can increase monthly automobile sales.  Seven different subprime loan programs are available from non-prime “preferred” to the first-time buyer program.  Each loan program is designed to match the financial needs of certain applicants who have steady monthly income and an acceptable time in the same job.

Non-franchised dealers have access to great programs, including:

•           Advance up to a maximum of 125 percent loan-to-value

•           Approval for vehicles with less than 99,999 miles

•           Reserve on four loan programs

•           Loan minimum as low as $1,400 minimum income

•           Terms to 60 months

•           Low fees and APR

Purchasing a vehicle is required for many people who must have personal transportation to go to work.  Consumer Portfolio Services works with dealers all across the country with the desire to sell vehicles to hard-working Americans.  The subprime auto loan market has expanded over recent years to fill the gap left behind as traditional lenders changed the qualifying criteria.  CPS will continue to develop loan programs that support the needs of dealers and consumers.

Consumer Portfolio Services: Decades of Third-Party Financing

Since 1991, Consumer Portfolio Services has been working with member dealerships to provide car loans to consumers.  Few people can afford to buy a car without securing a car loan.  In the early days, most people fell within the prime lending criteria.  CPS specializes in subprime loans, which were offered to consumers with poor credit.  Few borrowers fell within the subprime category.  Dealerships were able to offer financing through many different lending institutions.  Cars sold at an acceptable rate.  Consumers could count on the automobile industry to offer great deals and finance the cars in most cases.

The events of 2008 changed lending rules in all categories.  Traditional banks refuse to offer financing to anyone who presents a risk of default.  The role of subprime car loans has expanded dramatically.  Consumer Portfolio Services responded with a wide variety of subprime loan programs that would fill the void.  Consumers are surprised when they are told that subprime lending options are the only ones available.  Local dealerships do not always have access to subprime loans.  CPS has watched the dealership network grow exponentially since the shift in lending practices.  The narrow subprime lending category has grown to encompass every loan that is not prime.

In the subprime market, Consumer Portfolio Services has become the only lender to offer car loans to people without perfect credit.  Dealerships are able to sell more cars since the buyers are able to find financing.  Most of the cars financed through CPS since the prices fall within the affordable range.  Each car buyer will be qualified without regard to race, age or other demographic factors.  With sufficient monthly income and time in the same job, the application will be evaluated automatically.  The salesperson will receive a response through the website in a matter of minutes.

Consumer Portfolio Services: The Beauty of Pre-Owned

Vehicles built in the past ten years have many years of useful life remaining when the first owner trades them in for a new model.  Consumer Portfolio Services offers most of its auto loans to buyers in the pre-owned car market.  Dealerships maintain a healthy pre-owned inventory because of the affordability of these beautiful cars, minivans and light trucks.  Payments on an auto loan are more affordable when the car buyer selects a pre-owned vehicle.  Repaying the entire loan is important for the buyer with less-than-perfect credit.  Salespeople are wise to match the buyer with an affordable vehicle to expedite the loan approval process.

At the dealership, the car buyer will work with a salesperson to fill out the Consumer Portfolio Services online application.  Length of employment and monthly income are the primary criteria used to determine if the car buyer can afford the loan.  Demographic information, such as race, gender and age, are never used to determine if the buyer qualifies for the loan.  An automated approval engine evaluates every loan application sent through the CPS website.  More than 97 percent of all electronic applications will be processed through the automated decision engine.  In some instances, the salesperson will contact a loan specialist to find a workable deal for the borrower.

Every CPS loan program is designed to offer the borrower an opportunity to reestablish a good credit record.  Loan payments must be affordable, which is the reason that most loans are offered for pre-owned vehicles.  The price difference between new and pre-owned can be substantial.  Borrowers must be open to the possibility that a pre-owned vehicle is useful and affordable for many years to come.  Many times, the borrower is able to afford a nicer car because of the pre-owned price.  Salespeople are helpful in the selection of the best car for the buyer’s monthly income.

Consumer Portfolio Services: Car Financing Has Evolved

Buying a car once meant simple financing choices with a day-long battle over the vehicle price.  Consumer Portfolio Services knows that times have changed dramatically for the consumer.  A visit to the local showroom will reveal a shift in qualifying criteria that leaves most borrowers in the subprime category.  Traditional banks refuse to accept the risk that was once associated with lending money to people without pristine credit records.  The result has left dealers with the need to train the sales staff in the explaining this series of events to virtually every car shopper.  Subprime loans no longer carry a stigma in the financial sector.

Consumers must realize that dealerships in the Consumer Portfolio Services member network are able to offer many different subprime loan options.  Instead of fitting into a narrow set of criteria, the borrower will find an affordable loan program that matches his specific financial situation.  Anyone with imperfect credit and steady employment will be handled with care.  Salespeople will complete the CPS online loan application with basic financial information and length of employment.  An online decision engine evaluates every application without consideration for race, gender or age.  Every applicant is evaluated against the existing loan programs until a match is made.

Affordable car prices are essential for the buyer.  Salespeople realize that Consumer Portfolio Services will not approve a car loan that is unaffordable for the borrower.  Every effort is made to match the loan payment with the applicant’s financial situation.  Subprime borrowers can build a positive repayment record and be on the way to other financial ventures.  Access to credit is the key to home ownership, starting a business and financing a college education.  The auto loan can be the first step to building a positive credit history that is the foundation for success in life.


Consumer Portfolio Services: Car Buyers are Always Surprised

For many years, car buyers would apply for a car loan and be offered financing options that fell well within the prime lending category.  Consumer Portfolio Services was available for the few car buyers that had imperfect credit.  The subprime market made up a small percentage of auto loans that carried a stigma.  Consumers never wanted to fall into the subprime category because of the additional expense and concern that the borrower would default.  Dealers rarely dealt in subprime loans because the market was not broad.  Traditional lenders and auto financing entities covered the financing needs.

In 2008, the auto financing markets changed dramatically.  Traditional banks no longer accept any type of risk from individual consumers.  Auto loans are reserved for the buyer with pristine credit and enough money in the bank to not need the loan.  Since this profile is rare, dealerships have sought the help of Consumer Portfolio Services to offer subprime loans.  Car buyers with imperfect credit should ask the local dealer if he has access to subprime loan options.  Most car shoppers are unaware that a shift has taken place in the lending markets.  This surprise can be unpleasant if the salesperson is not able to explain what happened.

Smart car shoppers will obtain a copy of his personal credit report and determine if the entire history is accurate.  Consumer Portfolio Services encourages car buyers to be aware of the contents of the credit report to avoid surprises.  Corrections to the entries on the credit history will require time and effort, but the savings could add up quickly.  Each subprime loan program has a different interest rate that is set to offset the risk of non-payment.  The consumer should make certain that extraneous entries are removed from the credit history.  A visit to the local car dealership will be easier if the credit history is accurate.