Dealers' Payments Remain 'In Transit' | Auto Finance News | Auto Finance News

Dealers’ Payments Remain ‘In Transit’

© Can Stock Photo Inc. / seregamWhat’s the turnaround on loan applications today? The short answer: it depends. Dealers should expect a 48-hour turnaround for payments on contracts without errors, according to Open Dealer Exchange. But some lenders, such as Honda Financial Services, can keep dealers waiting as long as five to seven days, according to Automotive News. Mercedes-Benz Financial Services, on the other hand, will pay dealers in advance if they use the lender’s proprietary software and the contract is free of errors. Contracts in transit can become a strain on cash flow for smaller dealers. Tim Wynacht, a Florida dealer, said that in any given month he has $100,000 in transit, while the nation’s largest dealer group, AutoNation Inc., reported $370 million in contracts currently “in transit” in its 2Q earnings report.

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