Technical Finance
What is POI and when is it needed.
Proof of income
EVERY TIME
What minimum income do you need to write up a deal?
$2,000 disposable after mortgage and the new monthly payment come out of their GROSS income.
What is the monthly payment for this package?
Project Price: $25,000
8% tax
$3,000 down
A Credit
$258/mo = full credit (0.01074)
$273 - $274 = half credit (0.0114)
What does Non-Standard Financing mean?
What is A credit?
What standard rate do you quote them?
A+ = 800+
9.99% @180 (.01074)
If the bank needs additional information along with an approval, what is that called?
Stipulation (Stip)
When calculating a homeowners income, what number are you pulling?
Gross Income
What is the monthly payment for this package?
Project Price: $25,000
8% tax
$3,000 down
C Credit
$288/mo = Full Credit (0.01200)
Range from $290 - $340 = Half credit
If the homeowner's objection is time, what non-standard rate do you offer to solve that problem?
Deferral
Stop offering them unless you have to!!!!
(Option close to a bigger discount with cash or standard and people will choose that!)
These come out of your commission and may lead to the deal being cancelled for selling it too low.
1 lender offers a 3-mo deferral, 7 offer a 6-mo, 6 offer a 12 mo.
6 mo (5%-8.75% hit)
12 mo (7.5%-11% hit) Probably unnecessary!
18 mo (12.75%-14% hit) Stupid! Option close!
24 mo (18% hit FS Only) Stupid! They have cash! A+ only!
What is B credit?
What standard rate do you quote them?
B Credit = 720 - 799
10.99% @ 180 (.01136)
What percent of sales in 2024 were financed?
78%
(76%-80% wins!)
When showing a payment to a customer, it is best to show them a _______ of a potential payment.
Range
+/- $20 with A/B
+/- $50 with C/D/F
What is the monthly payment for this package?
Project Price: $25,000
8% tax
$3,000 down
F Credit
$352/mo = full credit (0.01468)
Range from $360 - $410 = half credit
What is the minimum amount to be financed required to request a 240-month term.
$20,000 ATBF
Amount to be financed.
What is C credit?
What standard rate do you quote them?
C credit = 670 - 719
11.99% @ 180 (.012)
A customer can cancel a contract at ANY TIME if this isn't done...
They receive contracts the night of the sale!
VERIFY IT IS IN THEIR EMAIL!!!!!
If you fat fingered it, get an addendum changing their email and acknowledging they got the contract.
Role play... ask me for a cosigner.
Hosts choice, yes or no!
Stories sell! You can't just ask, you have to tell a story to lead into asking!
Reverse Engineer!
If my homeowner has B credit, and they can afford $350/mo, how much will the project price be when you can close them?
Do not account for tax/deposit
$35,810
$350/.01136, +$5,000 = $35,810
Which plan do we request to get the lowest payment, and who offers it?
6.49% @ 240 (.00775) Salal
6.99% @ 240 also accepted
A credit ONLY!!!! 9% hit!
Give them an option close at a lower price with standard. People with A credit will choose the lower price and pay the loan off faster anyways!
What is D credit?
What standard rate do you quote them?
D credit = 640 - 679
12.99% @ 180 (.01265)
Name 5 sources of POI
Sing the song!
"If you have a structured settlement, but you need cash now..."
Full time pay stubs.
Part time pay stubs.
Retirement.
Annuity.
401k.
Alimony.
Child support.
Disability.
SSI.
If a homeowner gets paid $3,500 gross bi-weekly, what is their annual income?
$3,500 x 26 = $91,000/year
Reverse Engineer!
If my homeowner has C credit, we are in ID (no tax), and they can afford $415/mo and $2,000 down in the PTA...
How much will the project price be when you can close them?
Project Price: $36,583
$415/.01200 + $2,000 = $36,583
What is the most ridiculous non-standard financing option we have?
0% interest for 60mo
16% hit from Service
17.35% hit from Synchrony
OPTION CLOSE TO A LOWER PRICE!!!! -OR-
Get a lot down! EX if you get at least 50% down, it will cut the hit in half and not tank the profit out of your commission!
What is F credit?
What standard rate do you quote them?
F credit = 639 and lower
15.99% @ 180 (.01468)