Third-party financing is becoming an increasingly popular option for home improvement contractors. This solution allows homeowners to finance their projects without paying for the entire cost upfront. In this scenario, the contractor typically partners with another company to offer various financing options such as fixed-rate loans, promotional financing, and revolving credit lines.
Third-party financing is the best option for several reasons, the top two being increased customer satisfaction and improved cash flow. Here are 5 reasons why this type of financing should be used for your home improvement business:
By offering financing options to clients, contractors can increase customer satisfaction. This allows clients to finance their projects and complete them on time and within budget, without having to dip into their savings.
Provides more payment options: Third-party financing gives customers more payment options beyond just paying upfront or through traditional bank loans. This means that customers who may not have the funds to pay for a project upfront can still afford to complete the project by spreading the cost over time.
Increases affordability: By spreading the cost of a project over a longer period of time, third-party financing can make it more affordable for customers. This can help contractors to close more deals and satisfy more customers.
Offers competitive rates: Third-party financing companies often offer competitive rates, which can be lower than traditional bank loans. This can make it more appealing for customers to finance their project through a third-party financing company.
Simplifies the payment process: Third-party financing companies typically offer a streamlined payment process that can be more convenient for customers. This can reduce the amount of paperwork and administrative tasks for contractors, which can increase customer satisfaction.
Builds trust and credibility: By offering third-party financing options, contractors can build trust and credibility with their customers. This can show customers that the contractor is committed to providing high-quality work and is willing to work with them to find a payment solution that works for their budget.
Third-party financing can help improve cash flow for contractors by providing a steady stream of revenue. Contractors can receive payment from the financing company within 2-3 business days, rather than having to wait for the client to pay.
Faster payment: When customers use financing to pay for a contractor's services, the contractor typically receives payment faster than if the customer were to pay in cash or with a check. This can help contractors manage their cash flow more effectively by reducing the time between completing a project and receiving payment.
Reduced risk: Financing options such as installment loans or credit cards transfer the risk of non-payment from the contractor to the financing company. This reduces the contractor's risk of not receiving payment and allows them to focus on completing projects instead of worrying about collecting payment.
Predictable revenue: Financing options that offer fixed monthly payments can provide contractors with predictable revenue, making it easier for them to manage their cash flow and plan for future projects.
Contractors can access a wider range of customers, including those who may not have the funds to pay for a home improvement project upfront. This can help increase the number of projects and grow the business.
The application for third-party financing is a quick and easy 5-7 minute process, which reduces the burden on contractors and clients. It allows contractors to focus on other aspects of the business and provides clients with a convenient and seamless financing experience. Here is how FinMkt offers an easy application process:
Streamlined application: The application process is streamlined and straightforward, with only a few basic questions that need to be answered. This makes it easy for borrowers to complete the application quickly and efficiently.
Online platform: FinMkt's platform is completely online, which means borrowers can apply for loans from the comfort of their own homes or offices. This eliminates the need for in-person meetings and makes the application process more convenient and accessible.
Mobile-friendly: The application process is also mobile-friendly, which means borrowers can apply for loans using their smartphones or tablets. This makes the process even more convenient and accessible.
Fast results: FinMkt's platform provides fast results, with borrowers receiving loan offers within minutes of submitting their application. This allows them to make informed decisions about which loan to choose and start the borrowing process quickly.
Offering financing options to customers can increase sales by making it easier for them to afford the contractor's services. When customers have access to financing, they are more likely to move forward with a project they might not have been able to afford otherwise. This can help contractors win more business and increase their sales revenue. Customer financing also leaves room for:
Larger projects: Financing options can also make it possible for customers to take on larger projects than they might have been able to afford with cash or savings alone. This can lead to larger projects and higher revenue for the contractor.
Higher margins: Contractors may also be able to charge higher prices when offering financing options, as customers may be willing to pay more for the convenience of financing. This can lead to higher margins and increased profitability for the contractor.
Third-party financing can help your business soar in a variety of ways. From increased customer satisfaction to improved cash flow, customer financing can help contractors grow their businesses and provide clients with convenient and affordable financing options.
By using FinMkt financing, you can initiate a customer project with confidence, knowing that the payment from the customer is guaranteed. If you're a contractor who is pondering over the thought of providing financing options to your customers, please contact us and we would be happy to discuss it with you!
