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Soft Credit Pulls – a Win-Win-Win Opportunity in Sales and F&I

Article Highlights:

  • The benefits of soft credit pulls for dealers, customers, and lenders.
  • Soft-pulls fit perfectly within your current digital retail strategy.

Shopping for a vehicle comes with all kinds of stressors for a consumer – some of which can affect their relationship with the dealer and lender. Why? Because of the typical requirement for the shopper to verify their credit.

Some consumers worry about the score that will come back. Some wonder if the score will be high enough to qualify them for the car or truck they’re hoping to buy. Others aren’t worried about the score, but are worried the act of running their credit will “ding” their credit a little.

Soft-pull credit checks are one way to alleviate this stress. A soft-pull credit check is similar to a simple background check. It still allows the dealer and lender to review a shopper’s credit score and financial standing but it does not impact the customer’s credit score. Additionally, shoppers can use this to find out if they are pre-approved before moving forward with any financing options.

Soft-pulls can strengthen consumer confidence and trust in making the right decision, and since they aren’t locked into anything they can resume shopping and even assess varying price ranges.

For dealers and lenders, soft-pulls continue to provide the necessary information about a customer’s financial situation to make informed, confident deals, ensuring a win-win-win for all parties.


SoftPulls in the Age of Digital Retailing

Sure, for all of these reasons dealers and lenders should be offering soft-pulls. However, when you consider the era of digital retailing we’re now in, soft-pulls are no longer a preference – they’re a must.

Research tells us personalized shopping experiences convince 53 percent of consumers to share personal data.1 Why is this important? Because today’s digitized car shopping process is all about personalization.

This means soft-pulls, combined with a ‘credit-first strategy,’ are imperative to the success of every dealer and transaction today. A fully personalized, digital retail process requires accurate monthly payment quoting – early on in the shopping process. Everything from vehicle selection, financing, credit eligibility, and trade-in valuations can affect a person’s payment composition. Obtaining credit at the beginning of the digital retailing process ensures a true personalized shopping experience that will help close more deals.


Soft-Pulls Are Part of a Credit-First Strategy

The right credit-first strategy, combined with a soft-pull approach, enables more seamless transactions in today’s digitized world of vehicle sales. Soft-pulls do not require a customer’s date-of-birth or social security number, relying on just the customers’ name and address. Yet, dealers still benefit from an early-stage snapshot of the customers’ credit profile, with insights into their buying power before building a deal.

With interest rates rising over the last year, establishing the right credit tier and payment options early on in the shopping process will benefit everyone involved and build more trust into the process. There is nothing worse than a customer assuming or estimating the payment in his or her mind throughout the transaction process, only to learn interest rates make their vehicle purchase just out of reach once inside the F&I manager’s office.


A Dealership-Wide Benefit

Aside from today’s digital shopping process, soft pulls can also benefit dealers in the service lane. Combined with solutions like equity mining tools, smart dealers are now easily integrating these features into their daily workflows as a way to build additional conquest opportunities.

Dealers, salespeople, and service managers can offer quick valuation calculations to show service customers how and where it might make sense to consider a new vehicle on the lot compared to the repair bill. This helps dealers conquest customers through service, as well as acquire additional used and pre-owned inventory.


Including soft-pull technology within your digital retailing strategy enhances the performance of your online-to-sales or sales-to-F&I hand-offs, and can uncover new opportunities in service. Additionally, providing early insight to customers on their credit limitations can provide transparency and eliminate lost deals from financial restrictions.


1: https://www.salesforce.com/content/blogs/us/en/2016/11/swap-data-for-personalized-marketing.html

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Ken Hill is managing director for 700Credit, a provider of credit reports, compliance, identity verification, and soft pull products for the automotive industry.

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