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Learn from the Leaders in F&I: Panel Discussion with David Parker

Join the panel discussion moderated by David Parker to learn best practices in finance and insurance (F&I) department, F&I menu presentation, reserve strategies, selling aftermarket products, credit risks, and compliance issues.

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Learn from the Leaders in F&I: Panel Discussion with David Parker

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  1. Learn from the leaders in F&I: A Panel Discussion Moderated by David Parker “F&I is how you make the money. Compliance is how you keep it.” Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  2. Finance Department Best PracticesJared Zimlin – Priority One • F&I = Sales Position not clerical • Selling & Reassuring Customer • Selling Underwriters • Why they should buy the deal Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  3. F&I Menu • The best way to present to all customers every time • “Sign to decline” • 100% T/O = Most $ • 3 x 100! Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  4. Reserve • Initial Interview • How much above buy rate do you start with? • How do you ask for it? Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  5. Gap / Credit Life / Disability Insurance • What is it? • Who should buy them? • How do you ask for it? • “Sign to Decline” Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  6. Extended Warranty • How do you ask for it? • “Sign to Decline” Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  7. Tire & Wheel Coverage • Presented on the Menu • Similar to AAA – Except covers the tires and wheels • Often offered through Extended Warranty companies Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  8. Prep the Customer for T/O to Business Mgr. • Bring up the topic of financing • Cash or Finance? • Mention a product or two… • Introduce the Business Mgr. Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  9. Know Your Lender Limits • Some will advance 120% plus extras • Tax, Reg., After Market Products • Some = 130% of advance all inclusive • Can be $3,000 to $5,000 + / deal for after market products Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  10. Document Fee & After Market ProductsMark Vanlente – Action Water Sports • Different names – - Doc Fee / Admin Fee, etc. • What is a reasonable charge? • Some states limit the amount • Many states – charge to one customer, must charge to all Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  11. Document Fee & After Market Products • Make the Doc Fee Non-Negotiable • Preprint Doc Fee on sales order • Charge the same $...cash or finance • Many states = taxable • Charge for freight and prep instead? • How do you explain what it is for? Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  12. After Marker Products • Retail Insurance • Better Coverage… • Stated/Agreed Value vs. Market Value • Bind Coverage on Weekends • Marketing Fee Paid on each referral? Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  13. Aftermarket Products • Pre-paid service (Provided In-House) • Bundle 2-3 Seasons Maintenance/Storage • 50/100/150 Hour service included • Discount 20% to 30% for prepayment • “Worry Free” Boating for 2-3 seasons • Fiberglass & Vinyl / Upholstery • Many sell for $1,499 cost installed $450 =$1,000 + profit • Any other products??? Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  14. Subprime Credit RisksGlynn Cooper – Marine One Acceptance • How is it different from “A & B” Risks? • Indirect Paper Only • Max Loan/Term • Recent Bankruptcies • Reserve Paid? • Avg Credit Score? • Non-Recourse Loans? Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  15. Credit Application Best Practices • Credit Application • More information - Quicker approval • Written Authorization • Minimize Access • Keep it Secured Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  16. Credit Application Best Practices • Credit Application • Written Security Procedures w Chain of Authority • Written Procedures for Storage • Ignorance of rules opens mgmt to Personal Liability! Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  17. Compliance IssuesLen Bellavia – Bellavia & Gentile …Compliance is how you keep it! • Privacy Act – 2 Components • Privacy Notices • Dealership policy – How their private info is collected, stored and protected • Includes SSN and DL #’s • Safeguarding information • What you need to know & do Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  18. Compliance Issues …Compliance is how you keep it! 2. Safeguarding information • Must be secured at ALL times • Designated person to pull Credit Bureaus • Keep credit apps for two years • Proper disposal of documents – Shred or Burn • Penalty for Non-Compliance = $11,000! Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  19. Compliance Issues OFAC Check List “Office of Foreign Asset Control” = Terrorist Watch List • Keep a copy of Driver’s License and OFAC Clearance in each deal folder • Penalties for non-compliance • $5m fine & 30 years in prison Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  20. Compliance Issues • Red Flags • Written Manual • Compliance Officer in dealership • Red flags check – copy in deal folder • Max civil penalty = $3,500 per violation • Medco, FPC are sources – OFFAC & Red Flags Checks Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  21. Compliance Issues • Patriot Act – 3 Provisions • Cash Reporting – Form 8300 • $10,000+ collected in cash • Includes cashier’s and bank checks • Does not include personal checks Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  22. Compliance Issues • Patriot Act – 3 Provisions 2. Adverse Action Notices - Circumstances when a dealer is required to provide… 3. Notations on Credit Report - Must call customer Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  23. Compliance Issues • Fair Credit Reporting Act (FCRA) Requirements: • Risk Based Pricing Notice • Credit Score Disclosure • Keep all credit applications 24 months • Penalties – - $100 to $2,500/infraction Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  24. Compliance Issues Truth in Lending Act (TILA)”Regulation Z” • Accurate Marketing Disclosure of • Down payment, terms & APR% • Trigger Terms: • Down Payment • Interest Rate or Term • Penalties • Up to $5,000 fines + up to 1 yr in prison Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  25. Compliance Issues Electronic Security • Enterprise level Firewalls • Intrusion Detection System (IDS) • Backups daily • Employee access restricted • Complex passwords – changed often Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  26. Compliance Issues Electronic Security • Lock file and server room • New Login required if no keyboard activity • Background checks on all employees • Cross shred all sensitive documents • Email filtering for personal info – SSN’s • Do not email credit apps or contracts Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  27. Summary “F&Iis how you make the money, compliance is how you keep it” • Ways to increase Income • F&I Menu • Reserve • Doc Fees - $399.00 / deal • Subprime Lenders • GAP/ Credit Life/ Disability Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  28. Summary “F&I is how you make the money, compliance is how you keep it” • Ways to increase Income • After Market Products • Extended Warranty • Tire & Wheel • Retail Insurance referrals Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  29. Summary “F&I is how you make the money, compliance is how you keep it” • Ways to increase Income – cont’d • After Market Products • Fiberglass / Upholstery Protections +$1,000/deal • Prepaid Service • “Sign to Decline” Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  30. Summary “F&I is how you make the money, Complianceis how you keep it” • Procedures for Compliance • Credit Applications • Safeguarding Information • OFAC and Red Flags Check Lists • Form 8300 – $10,000 Cash Rule Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  31. Summary “F&I is how you make the money, Compliance is how you keep it” • Procedures for Compliance • Fair Credit Reporting Act • Risked based pricing notice • Credit score disclosure notice • Regulation Z – Payment Disclosures • Trigger Terms – Down Pmt, Rate, Term • Electronic Security – Firewalls, PW’s, etc. Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

  32. F&I Panel Questions? Learn from the leaders in F&I Moderated by David Parker Tuesday, Nov. 13 2 p.m.

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