What is Vigo Car & Credit?
We have spent years in the typical Buy Here Pay Here business. When we developed Vigo Car and Credit we took what we hated from our years of experience and changed it. Throughout developing our program we consistently asked ourselves ” What do our customers dislike about doing business with us”. The number one item was that the car always broke down. This is because of the typical buy here pay here inventory. To help rectify this, we decided to carry vehicles that are no more than 2-6 years old with 30-60,000 miles. Carrying a vehicle with no more than 80,000 miles will insure that, with regular maintenance, it lasts beyond the term of the loan.
Most of our competitors carry a 2002 Ford Taurus with 120,000 miles on it for $12,000 and ask for a $1200 down payment. We felt that this type of price gauging was not conducive to the way our business was headed. With the current economy in mind, we felt that a 200% mark up should be 130-140%. Too many good people have fallen on hard times due to a lack of employment. So, our vehicles that are at least 3 times the life left of our competitors are sold between $13,495 and $19,495. This is unheard of in the sub-prime auto financing market. Why not charge a premium for a program that cannot be matched? Well, to maintain the great reputation that we have started with as well as increase the amount of repeat and referral business. Keeping this philosophy in mind, is it really necessary to charge the state max interest rate just because the customer may not have a better option? No, we work with finance companies that have agreed not to exceed 18.99%. Plus, they report to the credit bureaus monthly so our customer can establish or re-establish their credit rating.
It is clear that our inventory is clearly a better choice for our consumers but what if, since they all are mechanical objects, the vehicle breaks down? This is one of the worst things in our business. We work so hard throughout the week to make sure we offer a service that not many offer just to have it ruined by the reliability of an object that we do not have control over. I remember dreading Sunday. Although it was the only day we took off throughout the week it was also the day that I was wondering what voicemails I was about to walk into on Monday morning. The one day of relaxation… ruined. Granted the cars we carry now solve this problem, for the most part, but we wanted some more peace of mind to offer our customers as well as ourselves. We decided to include a 12 month/12,000 mile warranty with every purchase. This is not the typical warranty where our clients buy the parts and we have Jimmy Bob in the back shop install them. It’s not even a warranty that is through Vigo Car & Credit, it’s through ASC Warranty. ASC Warranty is a nationwide company which gives our customers the chance to take their vehicle to anywhere they want to have it repaired. If it breaks while they are in Florida on vacation, they can take it to the nearest shop to get it fixed. We also pay extra for the warranty our valued consumer does not have to come up with a deductible!
The previous business model behind a Buy Here Pay Here dealership revolved around trying to obtain the original cost of the vehicle from the customer as a down payment and the remaining payments would result in the profits of the dealership. We have arranged agreements with lenders that do not care as much about how much they loan or how much the down payment should be. All they care about is that the payment amount is affordable based on our consumers information.
We also did not like the denial process and the prospects feeling regarding a negative decision. We felt that a denial given by the salesperson was not the best option. The salesperson typically tries to remove the customer from the dealership as quickly as possible since they have realized that the commission chances have been limited. So what? They had a repo or two, what if they had a good reason? The lender will never know. We set up a process to solve this which results in the majority of our loans gaining approval. We set up a meeting between the customer and the lender via web conference on a plasma TV located in our showrooms. If there is something that the finance company is concerned with they can ask the customer directly. Now the consumer has the opportunity to defend the choices they made. Perhaps they purchased that repo from a less reputable dealer and the motor went out within the first 30 days so they gave it back. This can be justified and added as an exception by the lender but only if they know the full story. So no more sale man kicking you out of the dealership without an explanation.
Within 5 minutes of the web cam interview the lender sends us a payment approval with any stops they may include. It may sound something like ” Everything looks good on Mrs. Smith’s deal assuming her pay stubs match what she told us she makes, make sure you keep her payment below $450 and we should be good to go.” At that point it is our job to take what cash or trade equity the customer has available to them and apply it to the vehicle of their choice and make sure it falls below the cap received from the lender. If it doesn’t, we can tell our consumer what it will take to make it work or provide a less expensive option that they can purchase immediately. All of our vehicles fit the same standards that we have set for our company so it’s not a less expensive option will result in the customer choosing between two vehicles in the back of the lot that barely start.
Our customers do not have to, but if they choose to put a significant downpayment on their purchase they will be rewarded with a lower rate and longer warranty. If they choose to put $1500 down they will be rewarded with the same 12 month / 12,000 mile warranty and a 1/2% interest rate reduction. If they put $2000 down they receive a full 1% rate reduction as well as a 24 month / 24,000 miles warranty. All at no additional cost to them.
Our prospects may not purchase from us the first time they visit nor do we expect them to. It is our goal that every person leaves with the correct information including all pertinent numbers as well as the knowledge of the vehicle they are interested in that they will obtain from the test drive experience. We feel that armed with this information they will be able to make the most informed decision that our program far exceeds anything else offered in their current financial situation. We feel that we are revolutionizing the business as we know it and expect other dealers to conform to our practices and offer a better choice for the credit challenged consumer as opposed to taking advantage of them.