Millions of Americans have, by now, bought cars using financing that originated at a dealership. In the vast majority of such cases, loans issued by dealers are then sold to specialized companies that are far better positioned to service them.
Companies like Consumer Portfolio Services then become creditors to car buyers who might not previously have heard of them. In order to ensure that the ensuring relationship will be mutually beneficial, these lenders typically take great pains to make sure borrowers are served well.
Educating Car Buyers About Their Financing Arrangements
While car dealers appreciate being able to sell to as many buyers as possible, few are equipped with the capital, skills, or infrastructure needed to issue loans and service them until they are repaid. Instead, most dealers who extend loans to buyers who arrive at their lots sell those contracts on to lenders that specialize in this type of business.
This generally productive arrangement leaves some car buyers confused. In practice, it is a well-established way of specializing and extending financing opportunities to more consumers that has been used for many years with home mortgages. At the same time, car buyers sometimes end up wondering why a loan that was originally issued by a dealer has since become the property of another lender entirely.
As a result, companies that engage in this type of business typically do their best to educate borrowers as to the situation and all the options. Simply doing so generally ends up being an excellent way to ensure that a fundamentally useful type of transaction can provide the greatest possible benefits for all involved.
Listening and Responding to Concerns and Issues
In most cases, this will mean being ready to address any questions or problems that might crop up in the process. Buyers sometimes wonder, for example, if the company that has taken ownership of and now services a loan is a collection agency acting on behalf of the dealership.
Another common question concerns the options a borrower might have when financial difficulties make keeping up with payments difficult. By addressing issues like these and others effectively and honestly, lenders who specialize in this type of business help maximize its value to all.