Lenders need to have “some skin in the game” when financing subprime customers in order to mitigate losses and boost yields, said Donal Hummer Jr., founder, president, and chief executive of ThunderRoad Financial.
“From my standpoint, equity is king,” Hummer toldPowersports Finance. Requiring the subprime customer to have a “substantial down payment” is one of the best ways to ensure a good, strong performance, he added.