F&I And Sales On Same On Same Online Platform

complete credit applications

If customers can complete credit applications and finance paperwork before coming to the dealership, the benefits are tremendous.


Today’s digital shoppers expect a satisfying shopping experience. They want to be in control and demand information transparency and immediate gratification. These expectations for purchasing from auto dealerships have been shaped largely by other retail experiences – and by technology.

Sadly, transparency, instant gratification and satisfying experiences are not words universally associated with the traditionally time-consuming car-buying experience (which averages around four hours, according to most studies). But, is this entirely the fault of the dealership? The onerous F&I process, which dealers tell us is the least-liked part of the process by customers, is a major culprit: Why? Because, in my view, it has remained siloed and unconnected by technology with the rest of the shopping process – in fact, it is at the back end.

To make transparency possible and build credibility and trust, I believe connecting the sales and F&I processes at the very front of the buyer’s journey is a crucial – and increasingly available – approach to respond to consumer expectations. It makes sense if more of the transaction can be completed online prior to the visit to the dealership. The showroom visit will be shortened, leading to an easier, more satisfying experience for the customer.

Customers Want Faster Applications

In fact, according to a recent AutoTrader study, 72 percent of car buyers want to complete the credit application and financing paperwork online, thus minimizing the time they spend at the dealership.

By bridging the gap between sales and finance, the next generation of automotive F&I can reduce in-store bottlenecks and profit leaks caused by the traditional sales and finance department silos. How? Enabling consumers to do more of the car researching and buying online shifts the information pendulum advantage back toward the dealer. The even exchange of information and two-way transparency builds trust, accelerates the sales transaction and jump-starts the finance process.

The way consumers shop for cars has changed dramatically over the last 20 years. However, the way cars are sold has remained relatively unchanged for 50 years. The time has come for this inertia to change. My company recently conducted a nationwide survey of dealers in which 86 percent responded that negotiation and the F&I process are steps in the purchase process that customers dislike the most. Over 70 percent of dealers surveyed agreed with the statement that “creating one easy, streamlined buying experience – by starting sales and finance together online – is a worthwhile goal for our industry to strive for.”

complete credit applicationsWalls Between Sales, F&I

Most dealership sales and finance departments currently operate as disjointed silos, plagued with information disconnects, redundancies and other inefficiencies. As an example, during a negotiation sales managers typically eyeball the customer’s credit profile and use educated guesswork to land on finance terms without the involvement of their finance department or any real understanding of the intense complexities of their lenders’ loan underwriting, advance guidelines and pricing policies.

When that deal structure does land in the finance department, finance managers frequently shotgun the credit application to multiple lenders through loan aggregators such as DealerTrack and RouteOne, hoping that lenders’ “black boxes” will return decisions that match the “educated guesswork” done at the sales desk. Given the natural human error baked into this process, the results of this dis-integrated sales and finance process are loan re-writes and unwinds, the possibility of perceived discriminatory lending practices and profit leaks for both dealers and lenders.

For the customer, this means a painfully long transition from sales to F&I and more time spent on financial decisions. The time buyers spend in the finance office now averages 61 minutes, more than two-thirds the total maximum time consumers typically want to spend at the dealership (90 minutes).

Cut The Guesswork

With sales and finance processes that start together online (with the buyers’ credit profile and vehicle of choice are matched against multiple lender programs), the odds of putting the customer in the right car and right deal structure improve significantly. Guesswork with finance terms and loan “shotgunning” are eliminated, so loan re-writes and unwinds are minimized. Dealership F&I departments are freed up to handle more deliveries, sell profitable F&I products and enjoy more effective and efficient dealer-lender relationships.

This next generation of automotive finance department would be a win-win for both dealers and consumers, because it would bring finance to the front of the sales process. It would create a connected buying experience in which more cars are old, more profitably, in less time to happier customers – reducing risks in both profit and customer satisfaction by slashing the deal process from hours to minutes.

Here’s How It Would Look

Now, how would this next generation work, in terms of the interface a typical car shopper would experience? Here’s how:

  • The car shopper finds a vehicle in which he or she is interested, on the dealer’s website, either before visiting the dealership or just prior to the test drive. That customer clicks on a “Get Pre-Approved” or “Get Pre-Qualified in Seconds” button on the vehicle detail page, or VDP.
  • The customer next is then prompted to fill out a very short credit application that includes housing and income information.

3) The platform instantly pre-approves the qualified shopper based on the dealer’s defined credit criteria, matching customers’ credit, stability and ability factors against the vehicle of choice, with a menu of qualifying lender programs and terms.

It’s important to note that the dealer remains in complete control of all finance filters. All payment terms could be configured to include dealer mark-up, doc fees, service contracts, etc.

  • The customer picks his or her payment terms and prints the “Pre-Approval/Pre-Qualification” certificate, which includes information about the vehicle of choice and the exact, near-final finance terms.
  • With no credit application to complete in-store and no lender decision to wait on, the buyer is transitioned from test drive to F&I much quicker.
  • The F&I manager is able to spend more time effectively selling additional F&I products. The customer’s perception of time spent at the dealership improves. CSI soars. Costly loan re-writes decline.