Graphic by Doug Robinson
Today’s post will be relevant for those of you who offer financing as a payment option for your services and/or products. I realize it’s always a heart-breaker when your prospects are so broke they can’t pay attention, and can’t qualify for your payment plan. You’ve done your job successfully but you don’t get paid.
We have all heard lots of wild excuses from broke folks like these classics:
“We decided to pay off our credit card debt so we stopped making our house payment for a year.”
“I stopped making credit card payments and filed bankruptcy so I wouldn’t have any debt while buying a house…I should get approved, right?”
“I pay late fees every month, so won’t that get me a better credit rating.”
“My car broke down so I stopped making payments. I wanted them to come and get that lemon.”
“The construction workers moved my mailbox and we couldn’t find it for three months.”
“I thought she was paying it and she thought I was.”
“The bill was always due at a bad time of the month.”
“I make all my payments on time…to the collection agency.”
“The stamp apparently fell off my payment envelope.”
Sometimes a salesperson runs a call that was pre-screened and properly qualified and then executes a flawless need assessment and presentation process, closes the sale, and completes a credit application only to have the prospect rejected for credit approval. This is a real kick in the teeth and can take the wind out of any salesperson’s sails, affecting morale, attitude, and personal income.
What can you do to protect yourself against this? Here is a 6-pack of Plan B suggestions:
1. Assuming your local sales team has a hand in available financing options, the wisest thing to do is to offer more than one program, providing low rates for well-qualified customers on the one hand, and also much-needed financing for poorly qualified customers on the other, albeit with higher rates and more stringent terms.
2. If you are mandated only one source of in-house financing consider seeking out and setting up a relationship with a secondary financing source. It is a good defensive move to establish a more lenient and aggressive lender that you can send your rejections to for consideration. If they are accepted it simply becomes a cash job to you after they receive their approval and funding.
3. Suggest an equity line of credit or second mortgage to pay for your service and remind the customer that the interest may also be tax deductible.
4. Ask the homeowner to get a co-signer who has a better credit history.
5. Ask the homeowner if they can borrow the money from a friend, family member, credit union or bank that may be familiar with their past credit situation but willing to loan the money based on their current status.
Photo by Carly Rae Hobbins on Unsplash
6. If credit rejections occur frequently, consider pre-approving over the phone (if your state allows.) Your admin folks can easily be trained to mention up front that you have convenient in-house financing and can save the customer time by pre-approving now. Cash customers will automatically identify themselves so you will know they won’t have problems, and the finance customers who can’t pre-qualify can be coached by you about the Plan B suggestions just discussed during a confirmation call prior to going to the home. If you’ve been disappointed enough over time you should be tough enough to not schedule the appointment until after you know their credit-worthiness.
These ideas will help salespeople go into calls with a good attitude and confidence that they will get paid for their efforts when the customer says, “yes.”
—————-Help with Closing?—————-
In Doug’s book, Sell is NOT a Four Letter Word you can find closing help on page 205, You Gotta WOW ‘Em to Close ‘Em, and on page 210, Scoring in the Red Zone, or page 213, I’d Like a Second Opinion. Order it here and I’ll ship it FREE!
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©2018 Robinson Training Solutions, LLC
