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Attorney Erik Johnson and Allen Denson of Hudson Cook discuss regulatory issues at the recent National Alliance of Buy-Here, Pay-Here Dealers conference.

PassTime Partners with Verifacto

PassTime Partners with Verifacto Featured

PassTime and Verifacto announced the companies have completed a software integration

project.

Customers utilizing both Verifacto software and PassTime GPS solutions will now be able

to perform a variety of device management functions directly within Verifacto as well as

utilizing custom insurance status features.

Verifacto’s risk management system tracks insurance status and compliance for

lienholders and additional insured, combined with loan payment reminders and payment

processing.

Read 3044 times Last modified on Friday, 22 July 2016 20:21

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  • Vending Machines Prove Good Investment for Carvana

    Used-car chain Carvana is seeing strong growth thanks in part to its unique marketing, but also because of an old-fashioned basic of the business – financing.

    The Phoenix-based company is most famous for its so-called vending machines, vertical structures that house cars and use an automated system to bring them down to buyers.

    The first vending machine debuted in Nashville in 2015. Carvan now operates four total and plans on adding more as it moves into new markets.

    CEO Ernie Garcia said the vending machines are a great investment.

    “I think some of the brand assets, such as the vending machines, are a very important part of telling that story as well as establishing credibility because when you drive (and see) the big car vending machine, it gives you the sense that there is a real company underneath it,” Garcia said.

    However, the facilities also represent a fairly large investment.

    “It is the most operationally and capital-intensive thing that we do,” Garcia said.

    “It means acquiring a vending machine site, going out and finding a location, negotiating a deal with the land owner, going through entitlements with the city, and getting approved, and then physically building the space itself.”

    As Carvana grows, Garcia said word of its unique process is spreading. In addition to the unusual delivery method in some markets, Carvana conducts almost all of its transactions online.

    Garcia said new markets that are in close proximity to existing markets ramp up faster than totally new markets.

    National advertising on cable networks will play a large part in creating   awareness of what the company does to make these fresh markets grow faster, Garcia said.

    He said cable advertising makes sense as the company grows larger and that broadcast advertising will follow as it expands even more.

    In the end, financing matters more to most car buyers more than a cool delivery gimmick like the vending machines or ads on TV.

    Carvana is doing very well in this area, financing approximately 70 percent of its customers.

    Mark Jenkins, Carvana’s chief financial officer, said technology helps there, as well.

    “I think (that is) a number that’s enabled by the technology that we’ve built to provide a very seamless experience to customers who could very easily fill out a credit application form on their phone or desktop, and select from a wide variety of financing options that we make available in a very transparent way,” Jenkins said.

     

     

  • PassTime Introduces Override App

    PassTime's new override app allows consumers to request an override command directly from their smartphone.  
    From the app, consumers enter or scan their serial numbers or VINs.
    PassTime's system processes the request and sends an override command to the device (if available).
    Once the device accepts the override command, the vehicle starts as usual.

  • To Report or Not to Report Remains Question for Dealers

    There was a time when buy-here, pay-here dealers wanted to report to the consumer credit agencies and they couldn’t because their volumes were too low.

    Now they can, but many are growing unsure if they should.

    Regulations created in the past few years aim to allow smaller creditors, such as dealers, to provide information on their customers.

    This seemed like a great new opportunity at first, but many buy-here, pay-here dealers are finding it comes with risks for both them and their customers.

    Brent Carmichael, a Twenty Group Moderator for NCM Associates, said most his dealers are looking to get away from credit reporting and a few actually have.

    There are many reasons to offer credit reporting. John Giamalvo, Equifax’s vice president of dealer service, said millenials are especially aware of credit scores and see them as a reason to do business with a creditor.

    The key is making sure the process is done right.

    Giamalvo said the Consumer Finance Protection Bureau has published several guidelines on how to properly report consumer credit.

    One easy way to get in trouble is by offering more than you can deliver.

    “If you promise to repair your customers’ credit, you are inviting in the CFPB,” said Ken Shilson, founder of the National Alliance of Buy-Here, Pay-Here Dealers.

    One risk for dealers is that some dealer management systems automatically forward information to the bureaus, increasing the chance of wrong information winding up in a report.

    Dave Brotherton, a Twenty Group moderator with the National Independent Automobile Dealers Association, warned there is also a chance subprime finance companies will use the data supplied to the credit bureaus to poach buy-here, pay-here customers.

    Nick Markosian, owner of Markosian Auto Sales in Taylorsville, Utah, said he reports to the bureaus. But he does this because he also offers outside credit and moves customers off his own books when their scores improve.

     

  • PassTime Names CEO

    PassTime has named Jeffrey (Jake) Frank as chairman and CEO of the company. 
    Additionally, the company has appointed Chris Macheca as president in addition to remaining as the company’s chief operating officer. 
    Jake Frank is the co-founder of PassTime and previously served in numerous executive positions in the past, including executive vice president.  Frank received a Bachelor of Science degree from Pennsylvania State University and a master’s degree from the University of Virginia.
    Macheca has been with the company for 19 years.  During his career at PassTime, Macheca has been involved in all areas including sales, development, IT, operations, and manufacturing.
    Macheca received his bachelor’s degree and MBA from Regis University in Denver.  Prior to being named chief operating officer in 2015, Macheca served as executive vice president of operations.

  • Payment Devices’ Status Safe Despite Proposed Laws

    Payment assurance technology providers are preparing to fight back a new wave of legislation aimed to curb the industry following yet another negative press report.

    This time the bad press comes from CBS News, which aired a story that featured a couple whose car was shut off while at a dialysis treatment.

    The piece ran on several network affiliates.

    Corinne Kirkendall, vice president of compliance and public relations at PassTime, said she expects the same pattern as when the New York Times ran a negative article about the devices.

    “About every two years we get an uproar,” Kirkendall said. “We go back and we re-educate everybody.”

    This past year that effort included helping to shape a bill in New Jersey that started as much more harmful to the industry, its clients and their customers.

    “We’re all for responsible legislation, but we’re not all for legislation that takes away the consumer’s ability to get into a car,” Kirkendall said.

    The good news is legislators are moving toward making sure the industry uses best practices rather than banning the devices outright, said Nicole Munro, an attorney with the law firm Hudson Cook.

    “The legal status of the (payment-assurance) industry isn’t in jeopardy,” Munro said.

    The challenge for the industry is the lack of a main regulator. There have been laws considered in a half dozen states and an investigation by the Federal Trade Commission.

    This keeps some large financial institutions from using the devices.

    “If there were a regulator that says, ‘This is how to use them,’ they can better assess the risk,” Munro said.

    The future is not guaranteed.

     

Vending Machines Prove Good Investment for Carvana

Vending Machines Prove Good Investment for Carvana

Used-car chain Carvana is seeing strong growth thanks in part to its unique marketing, but also because of an old-fashioned basic of the business – financing. The Phoenix-based company is...

NABD Honors CFO

NABD Honors CFO

The National Alliance of Buy-Here, Pay-Here Dealers has inducted several high-profile operators into its Hall of Fame. But this year the NABD took the opportunity to honor somebody who played...

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