When your dealership uses a traditional payoff and title release process for trade-ins, there can be a lot of built-in uncertainty. Between the amount of time it takes to receive the clean title (18+ days on average) and the payoff surprises that can result from being unable to see the title details in advance, you can find yourself taking several calculated risks from the time you accept the trade-in until you’ve sold it or put it up for auction.
Fortunately, there are technology solutions that can address those risks and increase your confidence whenever a customer brings a car to trade in. Let’s look at some of these risks and how technology solutions for expedited titling can help you eliminate them:
The Man (or Woman) of Mystery
A customer comes in with a trade-in, but without their title in hand. He says he’s the only person on the title and so you went ahead with the deal. Later you discover that there was a co-owner on the title, but you can’t reach the buyer and you have no idea how to get in touch with the other person. Without the co-owner’s permission, you have a vehicle you can’t sell – and maybe a pending lawsuit as well.
Now let’s look at that same scenario for a dealership with the right technology on hand. As soon as the customer presents their trade-in, you can use the system to see a copy of the title. You discover the co-owner right away and ask the customer about it. That gives them the opportunity to get the necessary permission to sell the vehicle or proceed without the trade-in. Either way, you’ve eliminated uncertainty and risk.
When you don’t have access to an accurate payoff amount up front, your back office must deal with the back-and-forth of cutting checks and overnighting them to make it right – which adds time and expense to the deal.
Improved technology can provide the accurate payoff amount from the start, and ACH payment capability will save you from having to produce paper checks and pay to have them delivered.
Is It Time Yet?
Even using low-tech payoff and title release processes that take weeks, most dealerships will proceed with reconditioning, then retailing or auctioning a vehicle with their fingers crossed that the timing works out and there are no titling or payoff surprises looming.
When you have a solution set that includes expedited payoff and title release that takes days instead of weeks, access to online status updates on demand, and visibility into title details, you’ll no longer have to hold your breath and hope your inventory turn timelines work out.
How Confidence Pays Off
When you know you’ll have payoff and title release completed quickly and predictably, it can pay off directly by keeping a lid on the holding costs that affect your profitability. A 2016 Manheim Online Dealer Community survey found that having a vehicle sit on the lot costs dealerships an average of $32 per day. When you know you’ll be ready with a title in hand, you can take steps to merchandise each vehicle online or get it to auction more quickly to help ensure that it stays on your lot for as little time as possible.
Ready to gain more confidence in your trade-in deals? Learn how Dealertrack Accelerated Title can streamline your payoff and title release processes.