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If you are a business owner or a CFO looking for retail installment contract financing (consumer contract financing, consumer receivable financing or financing for consumer notes) you may find it helpful to anticipate being asked certain types of questions relevant to the funding you are seeking. This articles contains several types of questions which you might be asked.
You may be asked a question relevant to the type of terms you are wanting. Are you expecting your customers to pay you within twelve months, twenty-four months, thirty-six months or longer? The longer the terms of your consumer contract the greater is the perceived risk on the part of the funding source. Therefore, the longer the terms of your contract the greater the discount will be. |
Relevant to consumer contract financing or consumer receivables financing, etc. you likely can anticipate a question relevant to the APR which you will have written into your contract. The APR is generally (but not always) somewhere around 18 %. However, if you wish to not charge any interest at all to your customers you can discuss this with the funding source.
Another question you may be asked if you are looking for financing for retail installment contracts or funding for consumer notes will be a question relevant to the actual monthly volume you will be looking to have funded. If you have not started your business you may be asked for realistic monthly volume projections.
If you are looking to finance your consumer contracts you can expect a question relevant to your customers credit scores. There are different types of purchase programs available. You may be interested in a purchase program where you can sell your A and B credit score contracts and have your C credit score contracts serviced. On the other hand you may want a purchase program whereby you sell only your B credit score contracts. Still another option may be a program where you can sell your A, B, and C credit score contracts.
You may also want to think about whether you wish to sell all your consumer receivables on a monthly basis or only part of them. Does your monthly cash flow necessitate selling all of your retail installment contracts or only a portion of them?
If you are holding a portfolio of performing consumer notes, you may be asked if you would be interested in selling a portion of, or all of the portfolio of consumer notes.
If you have a portfolio of consumer contracts, you may also be asked if you are interested in having that portfolio serviced by a funding source. This can save you time and possibly money by freeing up your office personnel to perform other tasks.
These are a few of the questions you may be asked relevant to the consumer contract financing for which you are looking.
To learn more, click here.
Another question you may be asked if you are looking for financing for retail installment contracts or funding for consumer notes will be a question relevant to the actual monthly volume you will be looking to have funded. If you have not started your business you may be asked for realistic monthly volume projections.
If you are looking to finance your consumer contracts you can expect a question relevant to your customers credit scores. There are different types of purchase programs available. You may be interested in a purchase program where you can sell your A and B credit score contracts and have your C credit score contracts serviced. On the other hand you may want a purchase program whereby you sell only your B credit score contracts. Still another option may be a program where you can sell your A, B, and C credit score contracts.
You may also want to think about whether you wish to sell all your consumer receivables on a monthly basis or only part of them. Does your monthly cash flow necessitate selling all of your retail installment contracts or only a portion of them?
If you are holding a portfolio of performing consumer notes, you may be asked if you would be interested in selling a portion of, or all of the portfolio of consumer notes.
If you have a portfolio of consumer contracts, you may also be asked if you are interested in having that portfolio serviced by a funding source. This can save you time and possibly money by freeing up your office personnel to perform other tasks.
These are a few of the questions you may be asked relevant to the consumer contract financing for which you are looking.
To learn more, click here.
Read about Consumer Contracts Financing Process Part 1
Consumer Contracts Financing Process Part 2
Consumer Contracts Financing Process Part 3
Consumer Contracts Financing Process Part 4
Consumer Contracts Financing Process Part 5
Consumer Contracts Financing Process Part 2
Consumer Contracts Financing Process Part 3
Consumer Contracts Financing Process Part 4
Consumer Contracts Financing Process Part 5