Subprime car loans the focus of new program by Plaza Auto Group

A major automotive group in Ontario has created a program to address the subprime car finance market, after losing customers who couldn’t afford to buy used automobiles because of a bad credit rating, and has opted to do deals with companies specializing in these types of transactions.

Plaza Auto Group, which is based in Richmond Hill and owns eight dealerships that collectively retail Volkswagen, Kia, Subaru and Ram, created Get Auto Finance in April. Daniel Stein, CEO of Get Auto Finance and whose father Robert is the President of Plaza Auto Group, said the idea for the program had been in discussion for more than two years before it launched.

“Especially with Covid, and everything going virtual, and especially the lack of new cars, we thought it would be really good to push and separate that from our retail market,” said Stein. “If you look at a lot of the lead-generating companies, they’ve been selling the leads to dealerships for a long time. What we’re doing is generating our own leads instead of buying them.

“We wanted to retain 100 per cent of our customers. We also wanted to make sure we moved our inventory as well. Our process is designed to help educate the customer and help them to get up to the prime level. We follow up with them throughout the entire loan period and once their credit has improved, we’re trying to put them into new cars in the dealership a year or two later.”

He said Get Auto Finance will help customers with low credit ratings to get the financing they need and also the professionally explain the process.

“Sometimes the customer gets embarrassed when they come into the dealership and the people they just spent hours negotiating with tell them they are not approved and have to pay more. The customer says, ‘why wasn’t I told that in the first place?’” said Stein. “A lot of them don’t like the process. Our website has a lot of education on it to help them through it, and all of our finance managers do everything from A to Z so there is no salesperson and there are no levels. They deal with the situation from the beginning.

“This is really taking the financing as a separate entity with the customer, and it has proven to be successful, because they don’t feel embarrassed. The finance manager is not losing any money, whereas before he sold them product from the business office and couldn’t get it all approved.”

He said Get Auto Finance has worked unbelievably well internally and the plan is to launch the service to other dealerships not affiliated with Plaza Auto that don’t have a subprime department. He said his company has already worked with a few other franchise dealerships that contacted his company Get Auto Finance to help facilitate a transaction.

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