How Do You Deny a Credit Application?

Towards the end of last year, I was doing some consulting work with a dealership. Part of what we were working on was the sales process. Normally, what comes to mind is the presentation out front, inventory, greeting the customer, etc. We spent time on all of that since it is vitally important, but one of the things about the sales process that gets overlooked is, "How do you turn a customer down while creating a positive experience that would make them want to come back and do business with you in the future?" Different scenarios such as:  

  1.       Short Job Time
  2.      Short Residence Time
  3.      Poor Payment History with You
  4.      Poor Payment History with Others
  5.      Short Down Payment
  6.      Lack of Income

How would you handle one (or all) of these if you decided not to approve the deal that day?

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  • As the manager, I would:

    a. Assure we’ve thoroughly verified the credit application. 

    b. Personally review the credit application looking for reasons to sell (we already know why we don’t want to sell)

    c. Make the most of this opportunity to teach an associate, so have them with you throughout the process. 

    d. Personally “interview” the applicant, questioning and re-verifying some the main concerns we have. Make sure we aren’t overlooking any reasons to sell. 

    e. Having found nothing to justify a sale, I the manager would respectfully explain to the customer, without getting too deep into the “why’s” that we are unable to finance them at this time, but would like the opportunity to try again in the future.

    f.  Explain what is needed for them to qualify for financing and send your customer out the door with brochures and business cards, and most importantly, give them plenty of reasons to come back!

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