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Want to Increase Your Sales? Near Prime Financing May Be the Solution

That’s why I’m always glad when a contractor tells me they already have a financing partner. It tells me they’re serious about growing their business — or, at the very least, that they care about providing the best customer experience possible. But offering financing to all of your customers is not the same as having financing for all of your customers.

Let’s consider the numbers. Nearly 1 in 3 American adults have credit scores below the prime credit range. That means if you’ve partnered with a financing partner that only approves customers with prime scores or higher, a significant portion of your customer base is without options.

HVAC contractors who can provide an optimal financing experience for their near-prime customer segment are better positioned to beat out the competition. Let’s talk about why.

Expand Your Customer Base

Let’s get the obvious one out of the way. The more customers you can get approved for financing, the more business you can close. Those customers who may have delayed the project until they had more funds (or hunted down a contractor that’ll quote them a lower price) can now get the job done, by you, ASAP. And that impacts your cash flow now.

Near-prime financing options also help build trust with customers, which can lead to repeat business or increased referrals. Alleviating the financial burden of HVAC repairs or installs goes a long way with customers. One way contractors used to do this was by offering a discount or negotiating on price, but that tactic eats into your profit margins.

Offering a financing option for credit-challenged customers still allows you to work within your customer’s financial means without the hit to your bottom line. Then the next time that customer needs HVAC work or gets asked for a recommendation by a neighbor or family member, whose number will they reach for first? That’s right — yours.

Better Customer Experience = Greater Competitive Advantage

Having any kind of financing option at all used to be enough to give you a leg up on the competition. But like I said earlier, everybody and their mother is offering financing nowadays. The way to set yourself apart now is to ensure your financing partner can a) accommodate a broader range of credit profiles and b) make it ridiculously easy for customers to get matched with the right lender.

Let’s put it this way: Even if you have a second source of financing available for credit-challenged customers, what’s your process for getting them hooked up with that lender? Do they have to fill out another application after they’ve been rejected by the first? What does that do to your customer experience?

Rather than trying to put together a patchwork of lenders you’ll have to manually route customers through until they find a suitable match, I recommend choosing a partner that accommodates the entire range of credit profiles. For instance, homeowners who apply through the OPTIMUS platform only need to submit one application. And rather than going through a series of rejections until they find a lender who will approve them, they’re automatically matched with the right lender. That spares you both the additional paperwork and the awkward “What do we do now?” conversation.

Ultimately, finding a financing partner that can meet all your customers where they are is a simple, cost-effective way to differentiate yourself in a competitive market. It also makes your job a whole lot easier. If you’d like to learn more about how to get started with OPTIMUS, schedule a consultation today.

Author Bio

Kelsi Cooper is the Inside Sales Manager at FTL Finance, a consumer financing company specializing in residential HVAC. In addition to owning FTL’s sales strategy, Kelsi leads a team of Account Success Managers tasked with generating new business and educating contractors on the value of customer financing. Kelsi also recently co-led a breakout session at EPIC 2023, “Understanding Near Prime and Subprime Lending.” You can find her session on Contractor University.