Consistency and Longevity in the Open BK Niche

Friendly Finance Corporation

Non-business bankruptcy filings for the 12-month period ending June 30, 2009 were up 34 percent over the previous year, according to recently released statistics from the Administrative Office of the U.S. Courts, Chapter 7 filings alone were up 47 percent, while Chapter 13 filings saw a 12 percent increase.  

Figures like these are a signal that opportunities abound for dealers who are willing to take on the bankruptcy niche market. To tackle it successfully, however, they need to partner with the right finance company. Enter Friendly Finance Corporation, a company that has been helping dealers serve the subprime auto finance market for over 60 years. Currently, the company purchases retail installment sales contracts from both franchise and independent dealers in Ohio, Michigan, Indiana, Illinois, Kentucky, Virginia, Tennessee, Georgia, Delaware and Maryland.

There are, of course, a number of subprime finance companies that will finance consumers with prior bankruptcies. What makes Friendly Finance different from many other finance companies is their focus on customers with open bankruptcies. Their specialty is the consumer who has not yet been discharged from a Chapter 7 or Chapter 13 bankruptcy. They will even also consider customers who’ve had multiple bankruptcies.

In such a highly specialized area of business, proven experience is probably the number-one trait dealers should look for in a finance company, and Friendly Finance has no shortage of experience. “Our expertise and knowledge in this area is unsurpassed and proven over the past several decades in this business,” said Steven Pittler, president of Friendly Finance Corporation. They use that expertise to help dealers gain the edge they need in a difficult market. “We give our dealers the ability to get their customers on the road before their competitors even get the opportunity to seek financing,” he said.

A distinct advantage to doing business with Friendly Finance Corporation is that dealer agreements are not required. Also, all contracts are 100-percent non-recourse. There is no computer scoring system used to evaluate deals; all information is evaluated by Friendly’s credit investigators and buyers, who focus on a customer’s current and past automotive pay history along with ability to pay and stability in both job and residence. Consideration is given to customers with past-due accounts, unpaid medical bills, defaulted student loans, and previous repossessions before bankruptcy.

Unlike some finance companies, Friendly Finance does not consider credit scores when evaluating credit. “We look for ways to put deals together that make sense, regardless of an applicant's credit score,” said Pittler, adding that his company understands the importance of financing subprime customers in cars with payments they can afford while still maximizing profits for dealers.

He pointed out that dealers who profit the most from this unique niche are those who utilize PACER and other data-gathering sources to track open bankruptcy filings and then use mailers and other marketing means to attract those potential customers. He added that at Friendly Finance, they can even offer suggestions and assist dealers in their open bankruptcy marketing efforts, further increasing a dealer’s chance of success.

Pittler noted that the tumultuous economy has been precarious for both dealers and finance companies alike. In times like these, solid relationships between dealers and their finance sources are more important than ever, and consistency in lending is paramount to maintaining those relationships. “We feel that consistency is the key to a successful relationship,” Pittler declared.

 “Today, auto dealers are more interested in developing stronger dealer-lender relationships, and pivotal in the customer's approval process is our consistency.” He added, “Our business philosophy has always been to maintain close relationships with all 3,000-plus dealers with whom we are presently doing business, as well as new dealers we are welcoming every day,” he said.

He also placed particular emphasis on Friendly Finance Corporation’s longevity in an ever-changing industry. “The special finance market is constantly changing,” he observed. “As the pool of subprime buyers continues to grow, there will always be new players in the game. How long they will be able to stay is the real question,” he said. “Over the past 60 years, we’ve seen many subprime auto finance companies come and go … Dealerships appreciate the fact that we were there for them in the past, are here for them today and will be here for them in the future.”

For more information on Friendly Finance Corporation contact Dave Anderson at 800.872.2877 ext. 231 or visit www.FriendlyFinanceCorp.com.

Vol. 3, Issue 5