Car Dealers - Out of Trust Situations - Tips on dealership
Almost every organization has a financial workout department. Their names are as diverse as problem loan administration; Central Loan Department; or the Special Assets Department. A broker can be assigned to one of these special services, or a member of the department can begin to appear at the regular meeting with bank officer of the dealer.The courts have always defended the rights of lenders to have training teams and have the teams, within broad parameters, take positive steps to protect the interests of the lenders.Matching the experience of the average dealer work-outs, that the experience of the lender, would be equivalent to equal a high school football team against a professional team. Professionals have played hundreds of games once. They saw and heard hundreds of presentations, arguments, excuses and reasons for the problems of a dealer, and the dealer, inexperience, faces the trauma for the first time. Realizing the dealer will probably be a neophyte compared to workouts, the following rules are provided to the concessionaire as a plumb line to follow throughout the training procedure: 1. Do not confuse friendship with Business . Factories and lenders have seen and heard most everything dealer training plans might suggest. The probably have versions of each plan have been refined over generations by some of the best minds in the business seen. Their experience, however, can not help the dealer to get the best benefits for the dealer.The employees of the factory / lender have a duty to their company and in turn to its shareholders, to get the best deal for their company. There is nothing wrong with that; they have a legal obligation to their shareholders and creditors to protect them, not you.However, they indicate if you workout plan is "acceptable" or "unacceptable" for them. If the proposed plan is "unacceptable", one of two things can happen. The dealer can keep propose plans until it is accepted or factory / lender might propose an acceptable alternativeIf the factory / lender suggests an acceptable plan for them it just means :. The workout plan is acceptable to the factory / lender. This does not mean, and should not mean, factory / lender will not approve another plane, which may be more beneficial to the dealer if the dealer knows what to ask and how to structure . 2. Do not confuse optimism with trust . Optimism means expecting a plan will work. confidence means knowing what to do if it does not. Never act without trust. 3. Do not the value of a concession by the "SOT + assets" Formula . The chances of this work plan are essentially the same as the odds against winning the lottery unless the ante is higher. 4. Do not say "SOT" . Sometimes a dealer speaks in terms of SOT (out of trust) or OT (Out of trust ) with the lender or plant units, when the dealer has actually SAU (Sold and unpaid). once the dealer refers to a position of trust, it puts the factory / lender in a precarious position. All kinds of rules then come into play, both legal rules and regulations of the company, which would be not had to take effect if the dealer has used the phrase SAU. the factory / lender can not read know the thoughts of the dealer really meant UAA, instead of SOT. as soon as the term is used SOT, the only thing that the listener knows for sure, if there is a lawsuit and the listener was asked whether the dealer said he or she was SOT on such and such a date, the auditor would have to answer "yes." Do not put them in that position. 5. Do not Lie . Do not lie to yourself; not to lie to the plant; not to lie to the lender.dealers, who lie to themselves about their problems, how they got there, or their ability to solve, base their entire solution on a lie and, without exception, compound and complicate problems origin.a lie to the factory / lender alienate the only entities that have both the ability to help and the most to gain, besides the dealer and the donor's family, to find a viable solution. When in doubt, remember what Mark Twain said. "I'm hurt by everything I did not say" He also said that when he was ninety, he remembered that he had worried many things in life, most of which never happened. 6. Do not panic . There are many challenges in business, and be short of cash is but one of them. many dealers have been there before and many dealers have survived.Analyze the problem as if it was the problem of someone other, and compose a short letter as if you were giving advice to another dealer. the advice should be to get professional help. a storm at sea, calls for experienced sailors. Nobody would want a team with little experience in storms, unfamiliar with the navigation, no cards, no radar and no one to seek advice. A dealer with a SOT problem is in a big storm, except that it will not go away with time. Without help, family, friends and dealership employees will all be affected. The dealer must make difficult decisions, or time will do-and the dealer will not like the decisions of the weather.When the lender has the second meeting referred to above, in which the lender wants the broker to sign the work-out agreement, the dealer should be prepared to structuring the work plan -out, manipulation of a guard, the repayment method and others.as soon as you know you are OT, your first call should be to us (or someone as experienced as us) and your second call (after visiting with us, your lawyer and accountant) should be to the credit company. Tell the credit card company that you sold and unpaid units before they tell you, is essential for the establishment of a foundation to build a work-out plan. At the same time, the experience of Automotive Advisors is essential to the dealer and the lawyer and accountant dealer, providing constructive suggestions and in planning and recognition of realistic options.
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