I have read a few posts on the floorplans. I have a few questions? Can you give an example on fees with a 10k dollar car for 30 days? I just want 25-50k to start. small lot and I sell on the internet also. 4-5 all cash cars per month looking to go to 15-30 with financing with floorplan.
How is autouse? fees?
I applied with all of them and I'm sending the supporting documents tomorrow. Just wondering how easy it is to get the line or will I have to keep using personal cash.
I purchased a house a few months ago and went a little crazy spending on credit cards, so scores dropped from 740 to 630 exp & trans and Equifax is 603.
I'm in California what are a few subprime lenders? ( I have pending sign-ups with westlake and credit acceptance already)
I just signed up with DSC, they are very easy to get setup with. My app was approved in 2 days. The fees are 9.5% maximum interest (they charge a premium on top of prime, so prime is at 3.25% right now and few points higher and the cap is 9.5% simple interest) and $135/car for 60 days and $85 for 30 days. So, you are looking at roughly $79/month interest (maximum, could be lower if credit is good) plus $135 one time fee totaling about $214 per car to floor plan with DSC. Its about 2% cost to financing a car with floorplan. If you are making 20% profit then I think the 2% cost is worth using their money.
They will increase the credit line after 90 days of flooring cars and repaying them. Their max line is $200k without financials.
I hope this helps.
Use them sparringly if possible but they will give floorplan to most anyone. Their risk is hedged by a good used car market. Back when I floorplanned it was 75-100 up front fee then 7-8 percent interest from day 1 plus a 30 day fee and curtailment and you could do 2 curtailments I think.
I remember adding up my fees one year and saying no more and only used my only money. Floor planning keeps prices up at the auction also. Ever seen a new guy at the auction with a fresh credit line...Don't be him.. lol Even though the money may seem easy and free its not. Lots of guys have went out of business overextending themselves with floorplans.
Good luck! Make your money and get out from underneath them asap.
I was approved by DSC & AFC. (25K Each)
Auto Use- Declined for only 4-5 cars per month
Now I plan to double my inventory and sale 6-12 units per month. I will go slow with the Holiday slowdown until January. I plan to floor 50% and use cash on 50% of units. My business plan is to own 1 car vs 1 Floored car .