Wake up, Buy Here, Pay Here people. It's a beautiful day. Go grab yourself another cup of Joe and say hello to Jim and Michelle Rhodes on the Buy Here, Pay Here morning show. Take it away, you two. Good morning. Happy Friday. Good morning. It's flannel Friday over here in Utah. Is it flannel Friday? I'm wearing a sweater, so it's sweater Friday for me. It was just decided upstairs before I came in. Was it? Okay, it's flannel Friday. Yeah, we were just having a conversation with our guest, and I'm about, like, I don't wear glasses normally because it's like the glare and all that, but I freaking can't see. So, you know, I'm old, and that's just, that's kind of the thing that happens. Wait, if you're old. You're ancient, honey. Absolutely ancient. Well, happy Friday. It's just so hard to believe we're already into twenty twenty five like we are and just moving forward. And I sent a video yesterday to our V-Eight folks, among others. I had a lot of people to catch up with and I was like, wow, I'm off to a really rough start to the year. How so? Well, I'm just behind. I'm just like, you know, I'm trying to get all the stuff that people are waiting for. We're trying to add more and more to our assistant and that kind of stuff. But it's like, there's so many pieces to what you do that you have to know the process. Well, we have been writing instructions, but then there's been some other opportunities come up that we just had to give attention to. So, you know, it's just stuff. It's just, but it's definitely, I finally yesterday, I felt like when I closed my, My laptop last night, I felt like I'm finally getting caught up a little bit. Well, good. Yeah. That's a good thing to go to bed on. Yeah. What else we got before we get started? Just remember, for everybody, we've got Jeff Martin coming next Friday. So look forward to having him come and kind of give us an update. And then the following Wednesday, we have Allison Harrison, who is an attorney and has offered – She gives time to White Hat Way, and she's going to talk about what happens if you get sued. Yeah, yeah. How does that look? What's the most likely outcome? Yeah, yeah, yeah, yeah. And then we mentioned yesterday that A colleague of mine from way back who works corporate as a fractional chief marketing officer is going to come and talk to us at the end. Actually, we shifted him yesterday, so it'll be the first Wednesday in February that he's coming. Yep. So we'll have kind of broad studies. Yeah, so we'll also be bringing on our podcast before the close of January, I'm sure, the data that's coming in from VA across the entire year. Jim always finds something that he's nerded out about and so excited to, like, ooh, I can't wait to share. Absolutely, yeah. Okay. All right. So today's topic, um, super, you see it frequently. Um, and you know, we know that there's a lot of factors in the topic around down payments. Um, and, uh, you know, all dealers have different ideas about it. And this is Jim. When we were talking about that this morning, um, Jim was excited because this is like it's a lot of data, a lot of data, which actually, you know how nerdy we are about numbers. The more data you have, the more solid your takeaways from the numbers are if you've got a big pool. For anybody who might be listening to the first time, it's probably appropriate for folks to know, this is my excited face. This is what I look like when I'm excited. I have to share that from time to time so they're aware and they recognize. I can vouch. Can you? Yeah. It's, you know, it's a little nuances. Yeah. Alrighty. So we're going to bring in our guest and guest stage, Kristen. And Kristen is Ohio. I was going to say Ohio. No, Iowa. And is a general manager. Yep. Southwest Iowa. We're in the corner by Omaha, Nebraska, right? And so happy to have you here. You guys have been in business since when? Nineteen ninety five. Ninety five. And Kristen works with a dealership that has an absentee dealer. So so Kristen is like the go to for a lot of the stuff. And so, you know, involved and he's still involved. Yeah. But he's he's Kristen is very, very trusted for their their dealership. And she's been doing this for a long time. How long you've been there for? Twelve since two thousand twelve. yeah got it okay yeah so yeah we're we're in uh into year thirteen here for her and so she she knows the stuff and I think um what you're going to see when we get around to sharing the slides and information the reason I invited kristen to come and spend some time with us besides the fact that we just like talking to her is the idea that the The data is really interesting coming out of your business. And I jokingly told, you know, one of our V eight groups not long ago, Kristen, that, you know, if Kristen had to wait for a thousand down, she'd never sell a car. Right. So, I mean, it's being facetious. Well, you should probably say Kristen is one of our V eight dealers. And so this is, you know, Jim has been able to be a part of some pretty deep conversations, and this is just one of the things that's come up. Yeah, and a little bit of background. So because I know Kristen and because I see their data in the V-A groups, one day, some time ago, I asked her, I said, if you'll share an exported report, I'll do an analysis because I'm really interested in that whole down payment factor because You know, our longtime friend Tommy Brandes, who's also been in business thirty plus years out in Pennsylvania, he chimed in on the post that went out last night on this subject. And he said, I've been preaching this, what we're going to talk about today. I've been preaching this subject for a while because it just... There's this perception across the industry that we want to offer an alternative way to think about it today, Kristen. It's like the way to think about down payment is it may be going to shift for some after they see this and see this data. So I'll tell you, we've got – and we can share the screen in a moment, but I've got – The analysis that you sent goes back to two thousand eight. This is sales, all sales, regardless of how they turned out, you know, whether the customer paid off or charged off, whatever. And that that number came up to twenty nine hundred and fifty two sales across that time period. And that to me, which one do you want me to pull up? So let's do let's do my spreadsheet with you. See that one bars. I'm sorry. The one with the bars. No. I only have one. Technical. We were talking about this before. It's like, nah, we're, you know, we're not that smart when it comes to technology. Good morning, George. So happy for having you tune in. Let me try it here and see if it looks right. So no, it's still not right. Let me remove that. So I might have to fix something here because the, the share is I'm sharing the wrong thing. But let me just go ahead and give numbers as I try to figure it out. So what that means, Kristen, at twenty nine hundred fifty two sales, I kind of put a little table together that says if you're selling ten cars a month, it would take you twenty four and a half years to create the history that we're about to look at. OK, so this is why I think it's important that thirty sales a month, even you're talking about eight years. Right. So it's like I think it's important for people to understand just how significant this is for for you to be able to take a peek under the hood of data that is strung across that kind of history. It just it would take you a lot of mistakes and a lot of years to ever learn what we're about to learn. Well, and the consistent stream of low down payments and high success in collecting out the, which is, we may touch on that today a little bit, but we've already talked to Kristen about having her come back and talk about that side of this conversation. So, you know, because anyone can take low down payments. Right. Right. A lot of dealers don't because they they don't think that they're going to be able to to make any money and that they will lose their shirts and that their loans won't be successful. And, you know, all of the different things. So this is really I'm I I don't nerd out on data like Jim does. But this is like, oh, I like because I OK, I'm going to rephrase that question. I don't nerd out on the same data that Jim does. But I have been, you know, I've been brought in to companies where they're like, here's our problem. We have this every year. And I'm like, you're collecting data. And then, you know, some, yeah. So I nerd out, but for different reasons, because I'm usually trying to solve problems and not show trends. So like, yeah. So I think I've got this ready. Let me go ahead and show it. So you've got, there's a ton of stuff here. So what we're starting with is kind of the pivot table that I created off of the data that I'll show folks the raw data in a moment. Cause I really want to have folks who are watching this to have confidence in what they're seeing, because it's, it's really important. People could go out and deciding to make business changes based on what they're going to learn here. And so I just want folks to have confidence in the, in the raw elements. So this part here in gray is what I was talking about. I just created a simple little table that said, you know, at ten sales, you'd have to be twenty four years to, Twenty sales, twelve years of data. So I'd like to get over here and show folks the raw data. And I think what I want to make sure we see right away is that this thing goes down to row twenty nine hundred and fifty three. There's a header up there. And so what I've done is just taken the raw data coming over from your software, Kristen, and I just created some. extra fields, I did some calculations on the down payment as a percentage of sales prices, which is what I chose instead of the number. If we just said, what is the down payment relative to the price of the car that they chose? Then that's how I chose to create the buckets. OK. And so this is where you see the groupings over here on the right is is a group of ten percent down payment or more. You can see these down payments over here. And so some of these get quite high, obviously kind of irregular transactions. But I left all of them in. And I think what folks are going to see is that the the the number of deals that you guys do with small down payments like less than two and a half percent is significant. Let me show that first. I'm going to make sure I remember which one is which here. I actually want to show that one last. Let's do this. Jim loves making charts because it does make it easier for everyone. I can just make sense of what I'm looking at when I see the visual. If you look at down payment as a percentage, look at our rows across the bottom. That tells you what buckets those are in. From zero to two point five, two point five to five. You've done twelve hundred and nineteen sales with less than two two point five percent down payment right so folks can go back and do the math on their own down payment their average down payment one thing I didn't run which we could probably see it here somewhere is the um the average down payment overall that you guys have in terms of a dollar amount it's probably in there uh but I think this is the part first I want to think about is you guys do an awful lot of deals with low down payment now you and I talked about we could probably conclude that a fair number of those are zero down with their, which are most likely repeat customers. Is that fair? Yes. Okay. So I think that's worth noting and we don't have a way, I mean, the software doesn't tell us who's a repeat customer, so we don't have a way. Oh, wouldn't that be nice if we could, we could see that kind of stuff. We need our CMS folks to help us in this kind of area so we can be able to identify that. I'm writing it down. Yeah, yeah, for sure. But that's something that's definitely one. You know what I what I find interesting here is the disparity in going from two point five or two point four up to ten percent and how it's like the success is at the two and a half or less, which is probably because of a lot of repeat customers as well, levels it out and then ten percent or more. Mm hmm. Yeah. And that, you know, you may have your own theories on what you're seeing there, Kristen. Any thoughts before we move on to the other? No, probably the ten percent and higher. You're going to see those as tax deals. You know, that's probably a bulk of those are going to come from tax time. Right on. Right on. Yeah. So that makes sense. Because that's a good time. A lot of extra cash out of people. And so we'll do just a plug for tax time payments. right exactly yeah it's that time of year again so yes so here's the kind of the the the thing folks are kind of interested to see I think is what is your success rate so now we're looking at portfolio results so now you're talking about net charge off as a percentage of the original note so that's what I chose to measure and you can see that the, certainly the best bucket is that ten percent or more. So if you only wanted to do deals and tax refund season, then, you know, obviously that's the best performing group. But then look at the next performing group is back to that zero to two point five. Again, probably repeat customers. But it's like or, you know, a fair amount of those would be repeat customers. But it's just so fascinating to me. Now, we just in fairness for the study, I'll just make sure folks know I didn't look at trade amount. Obviously, there's going to be some times that There's a trade in the picture and that we, you know, I just looked at down payment from the customer for the purpose of this study. And so, you know, by the time we meet again, I didn't share with everybody that we, Kristen's agreed to come back. We think probably on the thirty first because we're going to have a kind of a second topic associated to this. We want to want to follow through on. But go ahead, Michelle. Okay. Can you overlay the last one and this one? Do you have something that's a combined? Because I think that's an interesting, interesting thing to say. We're getting this much because like your group two, I think this actually shows it. This is percent of total. So when you see the orange bar that again, they're arranged across the, in terms of down payment percentage left to right. And so, the forty-one percent of the sales are here. And so, you're either, you're either having great success with low, low downs or with ten percent or more. But all of that stuff in between is, it's pretty high how much you're charging off. Yeah. Yeah. So let me let me tell you just how how significant this is. I'm going to show folks the one chart again that shows the so even the worst performing bucket for her at two point five percent is eleven and a half percent of net. The net charge off is eleven percent of the original note amount. Which means, you know, in my career, Kristen, I've been able to say, because people ask me, right, you're at a cocktail party, they find out what you do. And they say, so what kind of charge offs, you know, do those folks experience? I said, well, you know, everybody throws out the number. Thirty percent is pretty common. I feel like some of the best ones I've seen have been in the teens. That's kind of my typical answer is. And, you know, obviously I try not to answer this because I think you need to get real specific about these numbers, like what you're looking at. But when I look at yours, your worst is below the team. So you're charged off results. And I'm going to wait to kind of tell you what conclusions we draw in looking at that data. But I think it's important to show you. I got another title. I'm like writing notes. I want to talk about a few different things. Yes. Let me give you a quick comparison on this same, this same number that you're seeing here. Keep in mind the top bar up there, eleven point five percent. I'm gonna show you a different dealer with almost a thousand accounts studied the same way. History going back to twenty seventeen. So, you know, a little shorter time period. But look at their numbers instead. everything's pretty much at thirty percent this is net this is net charge off as a percentage of the note across all those sales so what I'm hearing is is kristen's really good at collecting he's not a coaching expert in that way and that's the conclusion she's really good and the other thing that I'm drawing a conclusion on if your low down payments are because you have repeat customers you're really good at relationships And we're really good at underwriting. Okay. Consistent at underwriting. Consistent at underwriting. Okay. So that's something that I've talked to Kristen about. She brought that to our V-A meetings and she's agreed to share the kind of the tool that she uses there. But they don't have a sophisticated software that they use for underwriting, right? You have your own checklist that you work from and you follow that process all the time. So you don't use a software at all for underwriting? No. No. And so when you follow that checklist, does it spit out? That's awesome. That really is. That's amazing. That's awesome. I love it. I mean, this is part of why I thought it would be helpful to have Kristen here, because I think sometimes we're trying to connect the dots. So Kristen, this is a really broad generalization, but I've been around the Buy Here, Pay Here space for a good time and a good while. And what I see is dealers think, well, if I buy the car well, and I recondition it well, and I underwrite it well, then that'll take care of everything, right? And so, I mean, that's broad generalization. Well, that actually adds another question I have. Yeah, and so I didn't finish the thing about Tommy Brandes, who's, you know, probably I think this year celebrates in business. And he's one who says, you know, you can do all that stuff, but if you don't collect well, Then because why this customer that we finance in our segment, they require a little one accountability to support. And so we have to have procedures in there because this customer, as a general rule, they're not going to pay on time and continue to pay unless we require them to do so in a loving, nice way. Go back to a visual of Christian's because we're still on the one that's not doing nearly as well. And I also want to, for those of you who are listening in our syndicated podcast station, it's not video. And so we'll try to read the things. But if you want to take a look at the charts, please head to Jim and Michelle Rhodes at the Octane Group, our YouTube channel, and you get all the video along with that. So go to YouTube and you can see the charts. So to that point, I'll quickly read for those not seeing the chart. At zero to two and a half percent down payment, that net charge off as a percentage of notes or originations is seven point five percent. So she's writing off only about seven point five percent after the repos recovered on that original note. So, yeah. So another way to think about that is she's charging off for every dollar that they finance, like this is the note net of down payment, right? So for every dollar that they finance, they're charging off about seven cents. Okay, dealers, I hope you're listening to this because that is amazing. Yeah. It's really, really, that's really, really great. It's really good. And so I think, you know, take folks inside the data history again. Let me show you. You're at column K- I don't know how many columns that comes out to be, but these are letters across there. There's columns and columns and columns. It's like A, B, C, D, and then it goes into a different thing, I think, too. These are all finance deals. Obviously, you're looking at the percentage, but I'm just trying to show you. This is the raw data just to give you a feel for how large a data pool we're talking about. We're just studying certain columns. What are you looking at? I'm just, you know, we're always telling dealers, it's like you can't assume anything. You have to measure. And, you know, we've had so many conversations on this. It's like you really can't draw a conclusion from something you're not measuring. And the longer you've been measuring it, the more solid your conclusion will be. Because you can't lie about numbers. Now, the next piece to this is, are we comparing apples to apples? In terms of like, if a dealer's looking at their number and Kristen's looking at her number, are we making sure that we're looking at all the same things and the data is strong? Because you can look at your own and be like, oh, we've improved here and here. But to be able to see how you compare things to the buy here pay here eco sphere you know the then it just is understanding apples to apples and that's why you know jim loves to look at the raw data and he's trying to make sure that he's pulling in these different pieces but this is this is impressive and and it it scratches a lot of the itch for You know, you can't draw a conclusion unless you've been measuring. And they've been measuring well before they met Jim. A very long time. And it's like hats off. That's really, really amazing. So, Kristen, talk to me about how you guys negotiate down payment. And what kind of conclusions have you drawn about down payments as you do deals? First, just how do you guys go about asking the customer for down payment? So on a typical month, our standard is always ten percent, but we know that's not always going to happen. We can have them walk out the door. So I kind of reflect back on underwriting. So we're always going to ask for ten percent. But if I see someone that's been at their job for five years, ten years, You know, they have the income, they have the stability, but for whatever reason, they don't have the full ten percent. I'm going to be like, don't let them walk. You know, don't let them walk. So it kind of goes on their stability. So if I have someone that's only been at their job four months, you know, they may not have the same leniency as someone that's been at their job longer. So I kind of cross reference there's stability with everything. And we'll kind of make that call because it's foolish if someone's been at their job, even three, four years nowadays, you're foolish to let them walk out the door without a car. If all the other things are there, don't let them walk. You feel the same about them staying in the industry? They've changed jobs, but they're doing the same thing because they got a better opportunity. That doesn't happen a lot in little towns, but we do look at job history. If they were at one job for seven years and they've only been at this job for six months, that does go in their favor. We will look at the previous job history and and kind of make a conclusion based on that as opposed to someone that's changing jobs every six months. Got it. Got it. So what I hear in that is you're the chief final underwriter. I mean, you look at the deals and kind of make the call on those. And so that that creates, you know, we're talking about thirteen years of consistency in that alone. so that that helps to make sure we use the same methods and I also heard you say that um job time is important like that's the stability indication right and so obviously when you're small town that I think becomes even more important and then you're you're just making those decisions based on that but talk to me just if you can kind of walk me through if I'm your salesperson you're training me how to go out and ask for that ten percent can you walk me through how that conversation sounds at a desk Well, most people usually ask how much down at the, you know, that's usually their first question. They want to know if they have it down. Um, but usually, you know, we get the application. Um, we usually ask them when it comes to underwriting, like we're getting all of their documents, we're completing the credit application. we just ask them, how much do you have down today? Or what's the most that you could put down today? It's usually not, do you have a down payment? It's, you know, how much do you have today? And then we just kind of work from there. So that's the conversation. Now, of course, if they ask, we say standard is ten percent. But when it comes to just the application, our question is just how much do you have down today? Okay. So then, yeah, I follow. And I think you're going to come back then and say something along the line. So I'll give you an example of the phrasing that I have been used to using over the years. It's like, we'll say to a customer, Well, we have a suggested down payment of ten percent. And I really emphasize the word suggested. So I'll just say we have a suggested down payment of ten percent. Just know that, you know, we're always willing to work with folks. We try to be flexible. And so, you know, is it possible for you to get a deal for less down payment? Yeah, there are going to be situations sometimes where more is required. But ten percent is a good suggestion. It's what we would recommend to give you the best chance of getting your loan approved. Okay, so that's kind of the approach that I would bring to asking for the question. And then they'll come back and say, well, I'm going to show them ten percent. This car is twelve grand. We need about twelve hundred. Oh, we got five hundred. When you don't, because you said you don't, if they ask what's the down, then you say ten percent. But in your regular underwriting, you're saying how much. That's like, for some people, that's the first down. break in the conversation about down payment is like, how much do you have to put down today? Right. So, so do you, you know, I, I'm, I'm thinking like a lot of the people that, that I, I watch on social, it's like, they're going to fricking low ball you. Oh, of course. Yeah. So how do you have that conversation? Um, It just kind of depends the situation. Sometimes when they really, really want an expensive vehicle, there are certain price points where we just really don't have wiggle room. They'll come up with the money. But we've just seen time and time again, people walk because they don't have the full down payment or they don't have any down payment. So we've seen enough people walk out the door. We're not really going to chance it. So if they say, We'll only have five hundred. And then we might say, well, we can do this. You know, can you come up with an extra five hundred? Sometimes they'll say, yep, I can do that next week when I get paid. And sometimes they just say no, but we're not going to if it's a good deal, we're not going to let them walk. So you just you just kind of got to gamble and hope they're being honest with you. But like I said, we're not going to risk a sale walking out that door. Yeah, so that brings me to the thing about, because some will ask, I mean, if people tune in this podcast and they're newer to the buy here, pay here space, they'll say, well, how much of this is just the way your business model and your business reputation? Like you guys just kind of have a reputation for helping somebody in a car with five hundred down as an example. Like, you know, that's we can't answer here. Like it doesn't matter. But I think the reality is what we're really trying to demonstrate is that But regardless of how you get there, you let the same buyer, payer, customer. And I know here's the other thing that people are going to say, but because Michelle's heard me talk about this. You haven't heard me, Kristen. But in my travels, there are two things that I can expect to hear when I go out and meet a dealer for the first time. Somebody on their team will say to me, that all sounds good, Jim. But what you don't understand is we can't buy cars like that in our market. That's number one. But the part that's relevant here is, Jim, you don't understand. Our customers around here are just different. And I think. No, they're not. They're not different. Your corner of Iowa is not different than somebody in New Jersey. The customer that we serve in this poor credit segment, do they have a different dialect? Sure. But as far as the things that they have in common and the way their life works and all these things, they're the same in different pockets of the country. And so I think this is the part that I would illustrate is like this customer that Kristen is financing is the same profile of customer that you're probably financing at your buy here, pay your dealership. And so it's hard to argue with the math. This is why we want to talk about the actual math and go deep inside the actual numbers, because I'm going to try to expand this where people can see a little better. You know, I didn't get Kristen the actual average down payment, but by bucket, this is the by... these different low down payment, obviously you're in that zero to two, you're twelve hundred deals that we talked about earlier. Our average down payment is eleven dollars is repeat. Then I'm taking that. That's that's that's awesome. That's a lot of we do do a lot of zero and half down sales because like I said, we can't get down payment. So the months that you see us have higher sales volume. is because we ran a half-down or zero-down payment special. So if you go through our Facebook, we do have a lot of specials too. So they're not all repeated. It's probably a bulk of them. But you will see some new customers in those buckets as well. And you still have very, very, very high success in those. So you don't use software. And you've said that down payment is what we're looking at. But the biggest thing that you look at in underwriting is job time, it sounds like. Yeah, I look at their stability and their income, yep. So job time and income. Job time and income, right on. And it's also interesting, too, if I look at the average of your sale price, your average sale price is actually highest in that low down payment bucket, which tells me, again, repeat customer, right? You're putting repeat customers into those deals that are... And so I think, you know, I heard a couple of things I'm sure Michelle picked up on too. It's like the, when you run a promotion of zero down, that customer's going to, you're going to have to be less lenient, right? You're going to use your same process that you go. It's just that your flexibility and your willingness to do zero for a new customer that you just met today, they're going to need to be pretty stable, right? But you still do some deals like that. yes on a few yeah yeah and so I think what that tells me is that this is the part that I'm trying to help our listeners uh start to connect the dots on and look I'm not saying every dealer should run out tomorrow and cut their down payments I'm just saying I remember a very successful dealer that I met years ago. Last time I saw their numbers, they probably had a twenty five million dollar portfolio and crossed five locations or something. And I remember him saying to me and to a small group, he said, you know, we tend to look past the down payment. Okay. So what would you conclude from that? Well, it's one thing I can, I can say that if I'm successful, got a twenty five million dollar portfolio and lots, you know, thousands of accounts and lots of cash flow, it's a little easier for me to be flexible. I can afford financially perhaps to be more flexible. When you're new, you think a lot about cash and deal. And obviously we've got to stay in business plan and stay in budget. But I think what I'm asking viewers to contemplate as they look at this is, first of all, maybe recognize that As you prepare your business plan, yes, you may need to budget a little bit differently in cash and deal. If you're going to start doing instead of holding out for an average two thousand dollar down payment, you're going to look at some lower down payment deals. But the volume opportunity, I think we all understand, when I say I could walk into any market, it doesn't matter if I'm in South Texas or New Jersey, I'm going to find more customers with credit trouble that can scrape together eight hundred down than two thousand. Just simple math, right? They're just simple. If you just look at a radius around your dealership or one in New Jersey, there are going to be more customers with credit trouble who are are going to be a little short on down payment. And you can answer that as well as anyone. Kristen, why is that? Why would a customer who walked into your dealership today be a little short on cash? It's just the economy. You know, we've seen I know that's like maybe a cliche answer, but when I was in twenty group not that long ago, They said even people that make really good income, it's not unheard of that people don't have money in savings. It's common and just kind of something we need to wrap our head around. The income may be there, but it should not be surprising that they don't have money put back. That's just kind of the way the world is right now. That's what I was kind of looking for. I think... that you know we're dealing with a customer in our segment who traditionally has not managed money very well they also are amongst the lower income folks in our communities and so we shouldn't be surprised that they don't have a large down payment if we still want to do business back when I first got in the buy here pay your business in the late nineties the coaching that I received was you know, look at the customer. It's kind of a different way to say the thing about look past the down payment, but look at, is this customer a good fit for my program? If I can help this customer with financing today, what's the likelihood that they're going to be successful based on whatever factors I'm going to use to make that decision? And I think with this data that we're looking at today, at least for me, supports the idea that I can do more business I can create more sales and help more customers in my community when I can first get a little more flexible about down payment now we know there are experts out there saying that um you know that the down payment is a predictor of success and what have you and we just think when I hear that I think I think folks should meet kristen acosta You know, this is why we obviously wanted to have you here today, but so go ahead. I, I have, I know we're running late, but I, I just, um, you know, we're going to talk about collecting and I think that the next time we, we, we get together, we're going to talk about not just collections, but support. Um, you know, what kind of support is being offered to your customers? Because I I'm going to make an assumption. That you buy the same types of cars as most everybody out there in the industry does. And that you probably try to keep your recon costs really low. And so, you know, it's like we're looking at... Because people are going, oh, she must have better cars. That's why she's got such a great ability to collect out. So the next time we get together and talk about... how you're collecting I also want to talk about um two other elements to that one is how you're supporting them and how you're developing a relationship with them um you know all part of collections all part of collections yeah but I think we probably covered enough today oh my goodness the uh the data I just think is is so significant I really just think it's important we've dealers that we work with that just really have trouble adjusting to the idea of shifting their business model in a way that meant less down payment. And sometimes they're worried about their cash and deal as a budget matter. Sometimes they're super focused on their borrowing base and how much cash can I draw in my line of credit to make sure I can cover that cash and deal and what have you. And I think what happens is it causes us to miss a lot of business. And so I just see that with a lot of the dealers that we work with and they're They have this kind of box that they operate in. And look, you know, we want to see people be consistent in their business model. Right. But we also want to see them do business. And so I really am basically trying to encourage people today. Maybe we shouldn't be afraid of this customer with a small down payment because it can still work out. Now, maybe we want to have a little more affordable selection of cars in that situation. Make the decision not about fear of success. Right. about your down payment. It's about, it's, if you need to keep, or fear of failure, thank you. I'm sorry. It's backwards day. It's Friday. The fear of failure, but it's, and, and then, you know, the next reason why someone might not is because they don't have the capital to have that much risk out on the road. So, you know, and that is, that is another part of the question. And they might have the capital if they bought a little different profile of car. They could make the math work. But I think the key thing I'm trying to get to is, you know, it's not surprising to me that the customer we serve in our segment is they come in on a Friday and they say, I need help with a car. Why? Well, because my last car got repossessed or I was borrowing my last car from my mom because you know, cause my other car broke down and, and now my mom's got a new job. So she, you know, I just, there's reasons that people come into your place, need a car and they're not prepared. They're still in a tough spot. They haven't. They're not sitting on two thousand in a savings account. And so we just shouldn't be surprised. And we I think part of our ability to do business in our segment is to be adaptable and to to look past the down payment and look at a little deeper underwriting and then be prepared to collect. So Kristen's going to come back and talk to us about how they collect because we you meet the new customer. How long is a new customer in your building? Kristen, that comes to meet you today. And how long is that process? An hour. So they're with her an hour in the sales department, but they're with you in your collection department. For how long was your average note running? Three years. Three years. So, you know, it's like it's that's where we got to focus. Oh, man. Yeah. There's well, there really are a lot of things to unpack, but it's just like just from success of beginning to end. There's an awful lot to learn and unpack how you've been so successful. So, first of all, thank you for sharing the data so we can share it with others and agree to make that available. I think a lot of people have a chance to learn from what we share. Yeah, for sure. And we'll all continue to do. Yeah. Well, we will know. We know that we're going to have Kristen back at least one more time. Yeah. You know, who knows? Well, our regular Kristen. Thank you. Thank you. Thank you. Thank you so much for taking time today on a Friday. It's going to be a busy day. Probably. We really, really appreciate it. If you will just, we're going to put you backstage, just out there for just a couple of minutes while we get everything closed up and we'll say proper goodbye and talk about the next tenure. Okay, sounds good. Thank you. Thank you. All right. Wow. Yeah. One quick note on that. This is almost thirty million dollars in receivables or originations that were studied. So, again, one dealer, you get consistency of underwriting. It makes the study a little more meaningful. But yeah, good stuff. Really, really great. To me, I'm just like, oh, I get excited about this kind of stuff, too. So I got to throw in one thing. Kristen didn't say it, but when I was talking to her about this before, She said, this matter of low down payment, she says, I hear the same chatter that you hear in the Facebook groups about more down payment means just whatever. And she says, I guess I'm going to die on that hill about, you know, you don't need that much down payment to have a successful loan. Absolutely. I don't want to see anybody dying on me. All right, everybody. Hey, thank you so much for making us a part of your Friday. It's January. I was talking to someone about, remember when we used to do checkbooks and I kept writing within the last year. We don't have to deal with that anymore, thank goodness, but have a great rest of your day and we will see you on Wednesday. Thanks so much for joining us.
