The financing tab is used to designate the lender and the parameters of the loan such as the buy rate, reserve rate, and discount rate.
If you are doing in-house financing, check the box Financed In-House here so the program will do the principal and interest calculations for you.
For Third Party financed deals and occasional Cash deals, select a finance company from the Financed By drop-down menu. If the finance company needed is not present on the list, scroll to the top and select the <Add New> option to add the finance company to the list.
When working with Settlement, the dealer may enter a Buy Rate for the loan that is lower than the rate at which the loan is being charged to the customer (Interest Rate from the Deal tab) and the program will calculate the settlement. If the lending company is paying a flat rate, do not use the Buy Rate field, just enter the flat amount into the Settlement Amount field. When using a Buy Rate to calculate settlement, some finance companies may keep some of the settlement as a Reserve. Use the Reserve Rate field to let the system know how much percentage wise the finance company will pay when receiving the Total Due From Lender and the program will automatically reduce the settlement amount accordingly and the difference will be recorded in the Reserve Amount field in the right column. Depending on your relationship with the financing company you may receive some or all of the Reserve Amount. You may record the date this reserve will become due to you in the Reserve Due By field. There is also a field that can be used to let the system know what date the reserve was actually received.
Because every dealer has a different relationship with their financing companies and because often dealers will never receive the Reserve Amount, this Reserve Amount is not posted to QuickBooks by DeskManager and must be dealt with manually.
When working with Sub-Prime customers, the loan company may wish to charge a discount for setting up this loan. In this case, either enter a Discount Rate percentage and the program will calculate the Discount Amount, or leave the Discount Rate blank and manually enter the Discount Amount you will be charged.
There are two extra fields for Additional Fees and each has a Description field to remind you what the additional fee was for. These fees are not added to the financing but are deducted from the Total Due From Lender. As a result these are fees that you absorb and not fees passed onto the customer.
Based on the deal structure and the data entered on this page, the system will calculate the Total Due From Lender.
If the vehicle being sold has data entered into the Wholesale Book field, that value will appear in the Book Value field. The Loan to Book Value percentage is then calculated as a ratio of the Total Due From Lender to the Book Value.