Quote:
Originally Posted by Deegee
Do dealerships have any clawback clauses with dealer plan reserves? Like if the loan is paid out at 90 days -- No reserve is paid to the dealership?
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Depends on the bank.
Most banks require 1 payment is made, that is all.
Our captive lender where we send 90% of our business, that is the only requirement, 1 payment. But they trust we aren't jerking them around either.
I believe some commercial banks have gone to 90 days though, yes. I know what you are alluding to though, and it was a problem with a lot of domestics with their rebate heavy business models. The banks plugged that hole with some warnings, and also capped reserves. So the greedy dealers shot themselves in the foot, and now have lost some opportunities.
We didn't play that game, it was a slippery slope, and under no terms, do you want to lose the support of your lenders.