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Original thread:
Post 3 made on Thursday May 21, 2020 at 19:32
buzz
Super Member
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May 2003
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On May 21, 2020 at 16:21, tca said...
We looking into a few and they all seem to charge us which we don't want.

Someone must pay for the financing. The finance company is essentially loaning your customer money and a certain number of those loans will go bad.

The customer might be able to finance the sale with a credit card. Perhaps you could find a company willing to finance for rates lower than the credit card company. This would give you some edge with the customer.

There are a bunch of contractors in my area who are promoting "free financing for two years". I'm sure that they pay something for the financing and that the finance company's wager is that the customer will be a slow pay and the finance charges balloon after the grace period. The contractor is justifying the cost as it generates more business -- at a higher cost, of course, but higher cost is better than no business. The construction companies have an easier time passing the finance charge through to the customer because it's hard to purchase plumbing installation over the internet.

Some of the big box stores offer free financing that is associated with a credit card. I suspect that the store is selling the contract to the credit card company at an attractive rate and that the credit card company's bet is that the customer is a slow pay -- making most of its money on the tail end of the contract after finance charges explode.

There may be a similar deal available to small companies like ours through the large buying groups. I've never looked into this.


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