Auto Loan Marketing for Small Car Loan Companies
Auto loan sales may have decreased recently, but car manufacturers will ultimately overcome their production issues and pent-up consumer demand
should keep this industry growing for years. If your company provides small car loans, these marketing strategies may help it stand out.
Targeting consumers online
People spend over seven hours each day surfing social media and the web, much of it spent researching vehicles and services. Lenders who offer auto loans can use digital targeting techniques to identify consumers that might be interested in purchasing one before reaching out with an offer of credit – this may involve tri-bureau credit data analysis or predictive modeling to find those likely to meet lending criteria.
Partner With Dealerships
Most lenders that offer small car loans often work with local dealerships to provide financing options at the point of sale, often letting customers select which dealership will sell them their vehicle. This is a cost-effective strategy to reach a wide audience and increase loan approval chances; just make sure that any dealership you partner with has excellent credentials for treating employees fairly.
Be upfront and transparent about interest rates
When marketing an automotive financing program, ensure all fees and charges are included in your rate structure so customers can make informed decisions. Being open about interest rates will build trust while possibly encouraging people to compare your rates against those of competitors.
Consider offering flexible payment terms
While it’s always wise to make timely auto loan payments, financial hardship may require that you rework your repayment plan. Most lenders should be willing to accommodate you if you are honest about your circumstances; some may require additional payments or even extend your loan term as necessary.
Look at lender reviews
Online lenders that specialize in subprime lending can be more vulnerable to regulatory agencies and consumer advocacy groups like Consumer Reports than others. Subprime lenders tend to present their business model as an inherent gamble; those with lower credit scores being riskier borrowers who deserve higher interest rates to cover potential losses. They have also been sued by multiple state attorneys general for working with auto dealers to upsell buyers into vehicles they can’t afford; cases against Credit Acceptance and Santander have already been filed alleging these practices.
Reduce the risk of bad customer experiences by selecting a lender with an excellent track record for responsible lending and an openness to negotiate on terms that best suit you. Checking with the Better Business Bureau and Consumer Financial Protection Bureau, for any complaints against certain lenders is also advised; be wary when applying with new or unfamiliar lenders as providing any personal details could allow someone else to steal your identity.