The explosion of eContracting or digital contracting over the past few years has brought unprecedented speed and efficiency to a process that was once bogged down by piles of paperwork. The right combination of technology and connections to lenders makes the entire process faster and easier for dealership staff, customers – and the lender partners who can fund deals more quickly.
If your dealership hasn’t embraced digital contracting for every deal, here are five reasons to take another look today.
1. More Lenders on Board with Digital Contracting
More and more banks, credit unions, captive financiers and independent finance companies across every credit tier are now accepting digital contracts. In fact, Dealertrack now has the largest digital contracting lender network, with more than 500 lenders available to receive and approve digital funding packages.
Says Joey Yates, AVP F&I Lender Strategy at Cox Automotive, “Chances are, the lenders you partner with the most are ready and waiting to receive your contracts digitally.”
When more of your lenders accept digital contracts, that increases your options to secure faster financing for every customer and stay profitable.
2. Get Your Money Faster
Cash in the bank is the goal of every sale—and digital contracting gets you 83% faster funding compared to paper contracts.1
One of the ways digital contracting gets you funded so quickly is by heading off errors that would lead to re-contracting with a manual process. Digital contracting leverages built-in validations so you must make any necessary corrections before you can submit for funding. With paper contracting, contracts often get returned for missing or erroneous data. Safeguards and checklists within digital contracting help ensure accuracy and completion.
Submitting the contracting package digitally gets it to the lender directly, so there are no worries about delayed shipping and contracts in transit. The lender receives your digital documents and you get your money as fast as the same day.
3. Safeguarding Your Dealership with Fraud Prevention & Compliance
Digital contracting can also mean more peace of mind with built-in compliance and fraud prevention steps integrated into every deal. Tools including Red Flags alerts, OFAC checks and out-of-wallet questions help confirm customer identities, while fraud detection and synthetic ID fraud alert features look for indications of potential criminal activity.
Other compliance tools help you comply with state and federal regulations so you can be confident that your dealership can avoid hefty fines and audits at your next audit. One of these features is secure digital storage of all contracts and other deal documents – retained for 10 years.
4. Maximize Convenience for You and Your Customers
Many of the lenders who accept digital contracts also allow for flexibility by offering remote signing. With the option to sign at the dealership or elsewhere, there are numerous scenarios where deals can go much more smoothly. Rural customers, young buyers having parents co-sign from another state, or busy car shoppers who can’t squeeze in a trip to the dealership can review their contracts at their convenience and sign from anywhere.
According to Cox Automotive Car Buyer Journey research, customer satisfaction with the car buying process increases with the number of digital steps involved in the purchase. Digital contracting helps keep the F&I process moving quickly and reduces the amount of time customers must sit idle. Dealers also report that customers appreciate being able to view their documents on a device screen and zoom in to read smaller print as needed.
5. Save Time, Save Money, Save Paper
Did you know that the average paper deal includes approximately 52 pieces of paper? When you use digital contracting instead, you’re saving about $50 in paper, toner, printing, shipping and form changes on every deal.2
Think of all the time and cost saved when you don’t need to print, copy and file all that paper. Not to mention the effort it takes to bundle it all and get it shipped to a lender. It’s a faster and more efficient process that also happens to save some trees. Win/win!
Set Your dealership Up for Success
It’s never too late to improve deal efficiency and speed cash flow with Digital Contracting. Check the lender list for your preferred lenders and talk to your rep if you need more digital contracting efficiency tips.
Sources:
1Data based on user input and calculations using Dealertrack’s Digital Contracting Savings Calculator as of July 2022 and are not a guarantee of actual savings.
2Savings estimates based on $50 savings from printing, shipping, and forms. Figures based on dealer calculations using Dealertrack’s Digital Contracting Calculator as of 2022. Not a guarantee of savings.
3Based on Dealertrack and dealer customer data as of August 2022 https://www.sierraclub.org/sierra/2014-4-july-august/ask-mr-green/how-much-paper-does-one-tree-produce
