Down payment is another term of sale that you will negotiate with your customer as you present your 4-Square. Understanding why it is important and being able to show your customer the benefit of putting cash down will help you sell more cars.
Why is it so important? There are really several reasons. First, it will make it easier for a lender to approve the loan. This is especially true if your customer has, for some reason, less than great credit.
The next benefit to the customer is saving money on finance charges. True cost of ownership isn't always about selling price. A customer who finances a smaller balance has reduced the chance they will have negative equity at their next trade cycle.
Does every customer have to put money down? No, people with good credit can often buy a vehicle with no cash out of pocket. Your job is not to tell a customer what to do. Your job is to show them the benefit of doing so and let them choose what is best for them.
The next benefit is obvious. By reducing the amount financed the monthly payment will be lowered. Your customers will understand this benefit if you will show them.
How do you ask for a down payment? Here is a word script to help you.
"Mr. Customer, as you know down payment affects monthly payment. In order to keep your payments as close to your perfect figure as possible, how much can you put down today?"
This is the typical customer response..."If I put down $$$$$ what would my payments be?"
Don't answer the customer with a dollar amount. You are locking your customer down on a figure. It usually sounds like this, "Oh, for every $1,000 out of pocket the payment changes by about $20-25 dollars a month."
Why not try this instead. "Mr. Customer I am not sure. I am going to ask my supervisor to refigure the payment with ($$$$$) down. While I am gone would you do me a favor and consider giving me some additonal help in order to stay closer to your perfect monthly payment? Thanks, I'll be right back."
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Down Payment is only part of your negotiations
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