Best Home Improvement Dealer Financing Programs
Posted on May 17, 2022
According to Angi's 2021 State of Home Spending Report, the average home improvement spending was $10,341—a 25% increase from 2020. And sadly, most banks and traditional lenders find it risky to fund home improvement projects.
So, how do your customers receive funds to patronize your business?
One proven way to get cash for home improvement projects is by sourcing funds from third-party lending partners.
Getting home improvement loans from these companies does not require collateral and is funded more quickly than other financing options.
Your customers can use the loan to pay for their home repairs or upgrades.
Why Are Home Improvement Financing Programs Important?
There are numerous advantages to utilizing a financing program for home improvement contractors.
Often in-house financing issues detract your employees from your business and turn them into collectors. Or you need to end up creating a whole collections department. However, you can avoid all these billing and cash collection hassles by working with a lending partner.
Customers and businesses who use financing services benefit from them. Your customers will receive funds to pay for their home improvement projects rather than paying a large lump sum upfront.
You will also close more deals, make more sales, and consequently, grow your business. So, it is a win-win for both parties.
As you might expect, most people cannot afford to spend a large sum of money. By providing other means of funding for them, a more significant number of your customers can afford your services.
This is great for customers who want to renovate or repair their home and cannot afford it, but it is also great for your home improvement business.
How to Choose the Best Home Improvement Financing Program
Finding the best home improvement dealer financing program for your customers can be challenging. However, it is essential to figure out which one aligns best with your company's goals.
Several financing companies offer favorable terms, but not all provide the same benefits. So, you need to carefully evaluate the financing options the company offers to avoid choosing wrongly.
When partnering with a third-party lender offering financing to your customers, there are several factors you should consider.
Are the home improvement financing programs tailored to your niche?
A generalist finance company that doesn't understand what your home improvement business is about and how much you charge might not release sufficient funds for your clients' home improvement projects.
So, when you want to choose a lender, start by surfing the internet for lenders in your field.
Rather than going for generalist lenders, you should select a niche-specific lending partner that can offer financing for all the project types you specialize in.
Can your customers apply easily for the funds?
A complicated application process might put your customers off.
Customers want a user-friendly and straightforward application that is not time-consuming.
So you should get a finance company that allows your customers to apply online or offers quick on-site applications.
Do they release funds instantly?
As a home improvement contractor, you need money to buy materials and tools and pay workers to get the work done. So, you should partner with a company that can provide the funding in no time.
Otherwise, you will be delayed and unable to move on to newer customers.
Do they offer customer support services?
You should partner with a company that offers excellent customer support. Although your customers might not need it right away, it might make a difference if they have payment problems or run into financial difficulties later on.
To ensure it is a good fit, look over the lender's customer service team and read reviews from their previous customers.
Do they offer flexible payment options?
When selecting a third-party lender for your home improvement business, you should also analyze the loan's repayment terms and conditions.
Different lenders provide different repayment choices, and you should select one that allows your customers to choose flexible payment options such as affordable monthly payments, low monthly payments, etc.
Selecting a partner with strict repayment terms might be detrimental to your business in the long run.
Are there additional fees to be paid?
Some lending partners provide completely free home improvement loans, which allow borrowers to avoid paying additional fees such as prepayment penalties, competitive interest rates, loan origination fees, late payment fees, etc.
Ensure that you inquire about the fees before partnering with any third-party home improvement financing company to look out for your customers.
What are their financing terms and conditions?
Lenders have varied criteria for approving loans. Some third-party lenders are more flexible, while others are more strict when it comes to financing conditions. As a result, you should examine the terms and conditions of the financing company partner before committing your business to a partner.
Do not hesitate to ask the company questions about their home improvement financing program. Some third-party lenders need you to meet particular criteria to obtain a loan, such as specified credit ratings, debt-to-equity ratios or credit history.
So, you should be aware of everything you need to do before getting started.
Will they approve your customers?
Partnering with a company that will reject the applications of most of your customers will affect your business negatively.
Customers whose applications were dismissed are less likely to patronize your business again. Instead, they will find an alternative contractor who can help them receive funding without rejection.
Best Water Softener Financing Programs
Posted on May 17, 2022
Choosing the right water softener financial program can be a challenge for many businesses.
Partnering with a third-party lender that offers solutions tailored to your specific needs plays a key factor in increasing your customer base and your revenue flow. On the other hand, choosing the wrong partner can hold your organization back and end up doing more harm than good. So, making the right choice is critical.
It’s not uncommon to see organizations partnering with big credit approval companies that end up rejecting many of their customers' applications. That not only stops them from growing but also ends up creating a negative image around their brand.
The Demand for Water Softener Service Financing
With whole-house water filtration systems costing over $2,000 on average, the need for homeowners and small businesses to spread the cost over time arises. When they see a price and bid proposal, they often turn down these projects or search around for other alternatives and your revenue is left unchanged.
As you may know, many of the other alternatives, also known as your competitors offer customers extra benefits with the ability to finance the purchase.
In order to remain competitive, it’s key to offer competitive funding options to make it easier for them to enter into a contract with you and go forward. This is especially true if the renovation is intended to increase the subject value of their property and they intend to sell it soon after it is finished.
How to Choose the Best Financing Company
To choose the best out of the numerous water softeners funding options companies out there, there are certain criteria that should be considered. Things to pay attention include:
- Ease of application.
In a world with numerous competitions, one thing you wouldn’t want to happen is your company losing customers due to its tiresome process of loan and financing option applications. You have to partner with a business that provides close to an instant and very fast credit decisions for your clients. This factor is just as important as choosing a partner in your niche.
- A niche-based partner.
This is quite an important factor to consider when seeking for partnership. A specialized partner is one that provides financing options for majorly your niche and in such case will be easier to get access to and you can enjoy certain flexibility as a result of this. Another point to note is that a partner in your niche would have had experiences and contact with similar companies and will be of better service to your business.
- How fast the company releases funds.
Your company needs cash to run and cater to new customers and the choice of your partner is a strong factor here. Your financial option should be able to give access to funding once the customer confirms the purchase of your services.
- Flexibility of the loan repayment.
Beyond the access to funding and loans, a great factor to also consider is how flexible the payment is in terms of the time frame and the interest rate. This is usually a case of trade-off and would need to be properly considered, as a short window may not be favorable for the customer and most people would prefer a longer time rate for an easy repayment system.
How this Decision Will Impact your Business
Water treatment systems that partner with third-party financing dealers that specialize in the water softeners industry enjoy sustainable results faster. Among the many advantages to your company are:
- Contact more customers - Simply by allowing your homeowners to pay in convenient monthly installments, you can now reach out to customers who previously couldn't afford to invest in a costly water softener project. This can serve as a form of free promotion.
- Engage on repeated deals - Homeowners who have had a successful water purification treatment are more likely to return to you for subsequent services such as maintenance, filters, and other related items. These projects are only feasible because of the flexible payment system.
- Receive referral - Funding loans frequently result in further referrals and promotions from friends and family.
- Set yourself apart from the competition - Don't be like the other dealer who doesn't offer financing loans. Water treatment can be prohibitively expensive, especially when additional plumbing, filtration and alterations are required. By offering payment plans on your homeowners' terms and getting paid in full right away, you can contact and convert more leads into purchases and set yourself apart from your competitors for free.
- Close larger deals - Larger projects and more projects are now possible because customers can purchase them.
- Receive quick payment - After the installation is completed, the full project quote is paid. This makes it easier to manage the cash flow system.